Trying to get a mortgage...

[TheTruth]

Hi Everybody-

I'm new to the forum and looking for some insight. My wife and I are trying to qualify for a new home loan. Her credit is great with a middle score of 770. However, mine isn't so great. My EQ is 499 and TU is 571. I had some collections and a judgement all have been paid. But, the killer is a student loan that was 120 days late as of Feb 2011. I had no idea that it was due as we moved middle of last year and everything was fine then. It is now current now as well. It's only 4k, I want to just pay it off but not sure if I should leave it alone and just pay it every month to build. I've also paid all my credit cards down under 30% utilization. Our DTI is good as our gross monthly income is around 18k and all we have is our car payments at $1100/mth, student loans @ $150/mth, and a credit card with a $2500 balance but a 17k limit. Question is can I get my a middle score up to 620 by June? Any thing I should be doing that I havent? Also, we are going to use a VA loan if i can get up to a 620, I already have the certificate of Eligibility.

[MBOhio2]

I would highly recommend going over to the "Rebuilding Your Credit" board on these forums. It's full of TONS of advice on how to legitimately increase credit scores, including how to deal with late payments, etc. If you go over there and post info about your specific negative items, you can get very tailored advice that is SO helpful!

[Anonymous]

Welcome...

Where did you get your scores? I ask because some providers offer a "what if" simulator that gives an idea of impact on credit scores by doing different things to accounts.  Is 571 your middle, or did you just get the two scores?  Are the collections and judgment reporting as paid?

I am assuming that you are the Veteran, and your wife is not?

Good luck and Thanks for Serving.

[TheTruth]

Sorry for the late response. I didn't realize anyone responded. We both are eligible as she served as well. All collections and judgments are reporting as paid.. Yes, my middle score is 574. I assume at this point it's just a waiting game to get the scores up.

[ShanetheMortgageMan]

May not be what you want to hear, but when you have not-so-great credit, the TU score here at myFICO.com tends to be a bit higher than your actual TU score that mortgage lenders will pull... so if you got your EQ & TU score from here, your EQ score of 499 is exact, but your TU score is probably lower than the 574 you are seeing.  I'd recommend continue to make your payments on time, a 120 day late payment in February of this year will likely push you out to being able to buy until February of next year - clean credit for 12 months is a requirement for pretty much all VA loans, barring any extenuating circumstances.

Can you guys qualify on just your wife's income?

[TheTruth]

Hi Shane-

The 574 middle is from a lender pull. We can qualify based off her income...just wondering is there any long term benefit from doing that? Other than the obvious of being approved now.

[mauve]

The advantage is not having to wait another year.

[ShanetheMortgageMan]

Well then I guess the scores aren't as gloomy as I made them out to be.  Your scores will result in lower rates until you can get them to a 640-660 level, and you'd have to wait... so those are the two items that wouldn't occur if she was just on the mortgage.