Running out of Time B4 Closing?

[Anonymous]

Hello it's me again, I really need help. Here's the deal. My score has took a major turn for the best!! It is now TU 546, EQ 602, and EX 586. Now we are schedule to close on the home in June 2008. I made a mistake and made a late payment on one of our credit cards in December. Since then I sent in a GW letter and still waiting today for a respond. I have three things left on there one of which shows should fall off on one of the CA in June 2008. Do you think that I have time to reach that 620 median mark before June? We wanted to go FHA but with late late in December might not make it possible. Nothing else is stopping us from this but that late. I'm really scared that we are approching crunch time. I sent in GW letter to some of the collection agencies that were paid off in 2004,2005 but haven't heard anything yet. What do you think?

TU 546, EQ 602, EX586

[ShanetheMortgageMan]

I think it's possible, I've seen clients scores increase 30-40 points in as little as a month... all depends on what is on credit.  I think the GW letter for the December late will help your score the most, then next those collections in 04/05.  If the December late is the only negative in the last 12 months, and your debt ratio checks out, then you might have a shot with FHA through an automated underwriting approval.

[Anonymous]

My score jumped with EQ from a 489 on March 8th to 602 on March the 21st. I was shocked. I havent pulled the FICO score on the other two though. I spoke to my realitor yesterday and he said that my DTI was at 30%. I have no OSB except for a repo with Americredit in 2004, Medical bill in 2001, and sprint in 2003 all of which are in collections. What do you think I should do. I have a paid collection with Centerpoint energy back in 2004 that I can't seem to get them to remove. Any suggestions?

[ShanetheMortgageMan]

I'm not really an expert on credit repair so I think you should ask this same question in the general credit section.  But you are on the right track - a 620 score is needed to secure conforming financing when there is less than a 20% down payment.  I'd press the credit card company on that GW letter to get the December late removed, then that way you would have FHA as an option as well.  With that late getting removed it'll probably bump your scores up above 620 - then you'd have both options.

[Anonymous]

Ok here the update for today. I contacted Credit one found a nice enough man that agreed to send a request to the adjustment department for the GW late payment in December 2007. I have two names of supervisors that agreed verbally to have it removed. I don't have it in writing yet but that's as good as I can have them. They told me that they would have this done 7-10 days. Do anyone know how long it will take the credit bureaus to update this information. Also, what is the first step in appling for FHA? As far as i see, we do qualify no lates, two collections on credit report over four years old. We have no car note and income of 100,000. No student loans. We really only have a loan that we owe 100.00 on were we have been paying installments. Do how do we look for a loan prior to closing in June?

[ShanetheMortgageMan]

That's great that you were able to work with them to remove that late, probably seals the deal on getting your credit into shape to qualify.  As soon as they report the new information to the credit bureaus it should update immediately at that time.  The first step in qualifying for FHA is to just take the plunge for a pre-approval, but it's recommended you wait until the CRA's update with the 12/07 late being removed.  Getting pre-approved just takes about 20-40 minutes to go over an application over the phone and hammer out any details on your situation, then a credit check, and running the loan through automated underwriting... within 30 seconds of submitting it a response comes back letting you know if you are approved or not.  Could take as little as 30 minutes for the entire process to find out.

[Anonymous]

Shane here is the update. I looked at EQ credit report today, and it show's that the late for 12/07 has been updated to show never been late. Now, when I got my FICO score it is still showing a 602. Is this normal? Since they reported it shuldn't I have gotten a jump in points for the late being removed? I also paid every cc off this month. My balance went from $940.00 to $110.00 Should this help with FICO points? If I don't have the score to qualify conventional, my loan officer said something about buying points how do this work? Who get's the money from that?

[Anonymous]

I'm not an expert by far but am going through a FHA re-finance and the FICO requirement for me was 560 to secure 6.75%

[Anonymous]

I'm getting scared now!!! I just called Credit one to see if they are going to remove the late for Dec2007. I spoke to a really mean lady who told me that that was not possible and that if they did this then it would be reporting incorrect information because they acctually did not recieve a payment. I sent in the GW letter that shows the only reason I was late was because the home that we were renting flooded and we moved three hours away. I put in a change of address and once I recieved the bill, we paid it in full. Now the problem is the late has been removed from EQ but not the other two now what?

[ShanetheMortgageMan]

bkadams64 wrote:

Shane here is the update. I looked at EQ credit report today, and it show's that the late for 12/07 has been updated to show never been late. Now, when I got my FICO score it is still showing a 602. Is this normal? Since they reported it shuldn't I have gotten a jump in points for the late being removed? I also paid every cc off this month. My balance went from $940.00 to $110.00 Should this help with FICO points? If I don't have the score to qualify conventional, my loan officer said something about buying points how do this work? Who get's the money from that?

I'm getting scared now!!! I just called Credit one to see if they are going to remove the late for Dec2007. I spoke to a really mean lady who told me that that was not possible and that if they did this then it would be reporting incorrect information because they acctually did not recieve a payment. I sent in the GW letter that shows the only reason I was late was because the home that we were renting flooded and we moved three hours away. I put in a change of address and once I recieved the bill, we paid it in full. Now the problem is the late has been removed from EQ but not the other two now what?

That is odd that the credit scores didn't update to a more positive figure but perhaps there is something else that is impacting the scores moreso than that item (I couldn't imagine what though).

Paying points (1 point = 1% of the loan amount being financed) is where you are charged more in closing costs in trade for a lower interest rate... the "points" get paid to the lender.  Basically you are giving them upfront money so they make less money (interest) off you over the life of the loan.  It works out to benefit the homeowner if they choose to stay in the home for awhile, usually 4-5+ years.

I'd suggest you call back CreditOne and speak to someone else, often you get someone who doesn't want to help and doesn't want to see things any other way than what they believe is the correct way.

Message Edited by ShanetheMortgageMan on 04-06-2008 01:26 PM