@alleycat1975 wrote:
Lel, on that note--and this could probably be a seperate topic, I know lol, but I have had a LO giving me some advice. My scores were terrible in june--she pulled me at EQ 456 TU 496 and EX 602, but this was before any paying, disputing, deleting etc. I have scorewatch and as of this weekend EQ 480 and myfico's TU was 570 and I don't know what EX is.
This was the info she gave me: Pay off, delete, settle, all of what i have on my CRs. Which I've been busting my hiney on and will have done by the end of Dec this year. I don't have any CC's at all so she said open 2 secured cards with 500 limits and don't charge more than 100 bucks or so and pay it off every month. With this she thinks my scores should be in the "financeable" range by the end of next year.
With this in mind we were going to start looking for Lease Option homes with a 2 year contract just to be safe. Is it possible I'm being fed a line here?
The moves suggested here can have mixed results, depending on how they are pursued and what types of accounts they are.
For collection accounts, paying them off typically brings the "date of last activity" to the present, so even though a collection account is marked as paid, it will continue to have a negative effect on your score, and may be worse because of the more recent DOLA. The best course of action would be to negotiate at pay-for-delete. CAs are under no obligation to delete, but many people have reported success is getting the CAs to do so.
If by settling an account you mean paying less than the owed amount and then closing an account, this can have a detrimental effect on scores if the lender marks your account as "settled for less than the amount owed" or something similar.
Disputing accounts in attempt to get them deleted can backfire, especially they are legitimately your accounts. In addition to being unethical, having open disputes on your account can sandbag your mortgage application. And you can't easily say, "I no longer wish to dispute this account" and expect it to go away, as some recent threads have painfully demonstrated.
Lastly, opening new credit cards shortly before applying for a mortgage is generally regarded as a no-no. But since you had no CCs whatsoever, then in theory it would be good to demonstrate proper management of these accounts. However, your score will get dinged by the inquiries, new accounts, and decreased average age of account, and the mortgage lender might not consider a 6 month history of on-time payments to be sufficient evidence of good management of credit.
For specific advice about how to improve your credit scores, I'd recommend posting over on Rebuilding Your Credit with details about the derogatory accounts that you're dealing with. You'll get much more specific advice about the best way to proceed, though some things that you have already done probably can't be undone. Good luck.
