Question about FHA Loan

[Jmc70]

I just applied for an FHA loan for a newly built home.  I ran my report and found my FICO score to be 611.  I have $700 in credit card debt which I just paid yesterday which eliminated my credit card debt.  I ran the credit estimator and it told me that by doing that I could expect to see my score in the range of 638-678.  I have no late payments in the past year and a half.  

Would my credit score increase by time I talk to the loan consultant on Tuesday?  Would they take evidence that I have paid my CC debt (i.e. printout of online statement).  

As of now I'm 9 points shy..

Any help would be appreciated.

Thanks! 

[Anonymous]

I'm very, very new at this also...so I will add my question to yours. 

First, I had thought that when you pay off debts it was only reported to the agencies once a month (I thought it was at the beginning....(WARNING), I could be very wrong).

My question to your situation is...I noticed that you only had the one number 611...is that the mid range score of all 3 bureaus or did you just pull one number?  I can tell you my experience with numbers that were very close to the minimum required.  I pulled all 3 numbers individually and then when I had the loan officer pull the single (combined) report the numbers where considerably lower.  I had all 3 of them at 610...612...615 when I pulled and they came back at 592...557...603.  I was shocked.  Now it took about a month for the CRA to report that I had paid off about 8 tiny balances that totaled about $2100...so the numbers are now 585...631...660.

I will also mention that although I made all of the $2100's in payments on the same day (late November)...half didn't register in December.  It still shows roughly half as having a balance when I paid it off in full.

 I hope someone corrects me if I am wrong...

[Jazzzy]

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@Jmc70 wrote:

I just applied for an FHA loan for a newly built home.  I ran my report and found my FICO score to be 611.  I have $700 in credit card debt which I just paid yesterday which eliminated my credit card debt.  I ran the credit estimator and it told me that by doing that I could expect to see my score in the range of 638-678.  I have no late payments in the past year and a half.  

Would my credit score increase by time I talk to the loan consultant on Tuesday?  Would they take evidence that I have paid my CC debt (i.e. printout of online statement).  

As of now I'm 9 points shy..

Any help would be appreciated.

Thanks! 

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I don't know what kind of credit cards you have...and that makes a difference. Most (but not all) credit cards report your statement balances to the credit bureaus. Then the credit bureaus report the new balances. If your cards report statement balances, then your balances wouldn't update and cause an increase in score until the next time your statements cut. There is such a thing as a rapid rescore, but you have to pay for that. Updating balances on credit cards is not something that can be done overnight. Also, there are credit cards that report on the last business day of the month.

If you ask on the Credit Card forum, those folks can tell you when your credit cards report to the credit bureaus.

Also...where did you get your FICO score? Is it a FICO? TransUnion or Equifax? As said above, you want to get both your TU and EQ FICO scores to get some idea of where you are at. Consumers can't buy their Experian score. You can get it from your loan officer after they pull it.

Hey...welcome to the forums and the wonderful world of FICO scores.

Message Edited by LynetteM on 01-17-2010 04:27 PM

[Jazzzy]

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@Anonymous wrote:

I'm very, very new at this also...so I will add my question to yours. 

First, I had thought that when you pay off debts it was only reported to the agencies once a month (I thought it was at the beginning....(WARNING), I could be very wrong).

My question to your situation is...I noticed that you only had the one number 611...is that the mid range score of all 3 bureaus or did you just pull one number?  I can tell you my experience with numbers that were very close to the minimum required.  I pulled all 3 numbers individually and then when I had the loan officer pull the single (combined) report the numbers where considerably lower.  I had all 3 of them at 610...612...615 when I pulled and they came back at 592...557...603.  I was shocked.  Now it took about a month for the CRA to report that I had paid off about 8 tiny balances that totaled about $2100...so the numbers are now 585...631...660.

I will also mention that although I made all of the $2100's in payments on the same day (late November)...half didn't register in December.  It still shows roughly half as having a balance when I paid it off in full.

 I hope someone corrects me if I am wrong...

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Hi jean...you say that you pulled all three numbers individually. Where did you get them? Were any of them FICO scores, or were they other credit scores (Vantage, PLUS, TransRisk, etc.)? Your loan officer will be looking at FICO scores...not the others. There are only a couple of places to get your EQ and TU FICO scores...and most consumers can't get their EX FICO score. Consumers need to be very careful in the "credit score" world. A lot of fairly meaningless scores are sold to consumers.

You're right that balances usually update only once a month on your credit bureau reports. When the balance is reported to the bureau can vary depending upon the creditor. As I said above, many credit cards report statement balance. Some report the last business day of the month. Either way, it is not a fast process,

Are the last set of numbers you posted (585...631...660) new FICO scores from the loan officer? If so, are you OK now that your middle score is > 620?

[Jmc70]

The score of 611 was my Equifax score.  The credit card that I just paid off is a revolving credit line and it reported on my credit report.  The last update was in December of 2008.  What I am trying to figure out is even if they don't report in time (this Tuesday) will the underwriter of the loan take into consideration that I had paid the debt?

[Anonymous]

Hi Lynette!  I purchased my FICO scores from this site and because you can only get the 2 scores now, I had the EX score that I had pulled right before they stopped reporting.  And yes, the new scores I have now are from my loan officer.

Message Edited by jean1968 on 01-17-2010 07:08 PM

[Anonymous]

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@LynetteM wrote:

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There is such a thing as a rapid rescore, but you have to pay for that. Updating balances on credit cards is not something that can be done overnight.

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Last I heard the lenders paid for the rapid rescore and were not allowed to pass the cost onto the consumers.  It may be worth asking about if you had a house in mind and needed to close by a certain date.