WIll I get approved and will I get a decent mortgage rate?

[Anonymous]

Here are my facts:

- Divorced 4 years ago.  Home almost went through foreclosure at that time but was able to catch up on payments.  Sold home two years later and have been renting for 2 years.

- Expect to purchase home in 6 months when savings will be approx. $67K - plan to put down 20% on $250K home

- Income is $150K/yr

- Only debt is a car loan for $13K/Expect balance to be $7K when applying for mortgage

- 401(k) balance is approx. $80K.

- FICO score approx. 630.  I pulled my credit report last month and discovered a charge-off from a credit card my ex-husband had that I was a co-signer on.  Was not even aware of this balance.  I immediately paid it (only $200) so I'm hoping my FICO score will improve as a result.  The credit card company would still not remove the charge-off from my credit report.

Will I get approved for a decent rate mortgage?

[CreditBob]

First, it's in your favor that the house was not reported as a foreclosure but instead late payments.  On the credit card, call the creditor, explainin the extenuating circumstances, and request that the charge off get removed. If they will not delete it from your credit report, add a consumer statement and this will have to be done with all 3 credit bureaus? DO YOU HAVE ANY CREDIT CARDS? If so, leave a small balance of $ 5-10 because you will score about 10-15 more fico score points. On the car loan, can you lower the balance at least down to 10-15%? That will help your score because you will have a samller balance? By the way how long have you had the car laon & what was the original loan amount? How long have all your accounts been open for and if you can breakdown credit cards, revolving, loans, auto loans, etc.???   Also go to this site for the fico score simulato because it will help you.   http://www.bankrate.com/brm/fico/calc.asp?lpid=BKRATE29

[Anonymous]

Thanks for your input CreditBob.  I cancelled all my credit cards when I divorced 4 years and paid off all the balances.  I now only have one department store card that I pay in full each month (I opened about a year ago).  Should I leave a $5-$10 balance on this card?

My auto loan was originally approx. $30K.  As I mentioned I expect the balance to be around $7K when I'm ready to apply for a mortgage.  I have had this five years.  Should I pay the entire loan off and have less of a down payment (15%)?

I have no other outstanding debt.  One note regarding the previous mortgage - the foreclosure process was started before I was able to catch the payments up, therefore, this is noted on my credit reports.