Will I be Pre-Approved after I get past 600 on EQ? FHA First Time Home Buyer, what to expect...

[Anonymous]

UPDATED ON 2/4/11: BeamMEup suggested I get some wisdom from the Mortgage Guru's on my upcoming adventure into  attempting to become a fist time home buyer.  I have talked to a LO locally and he says I should be able to get Pre-Approved once I get my Midscore above 600.  Here are my details for your thoughts and suggestions:

-Credit:

MYFICO TRANS UNION: 651

 Under my Accounts Section I have a total of 6 accounts:

1.Les Schwab, Paid or Paying as Agreed, Opened 5/2000: No Balance

2.Les Schwab, Paid or Paying as Agreed, Opened 11/2000 (different location): No Balance

3.First Premier Bank, Paid or Paying as Agreed, Opened 12/2009, Balance 35$/300$Limit

4.First Premier Bank, Paid or Paying as Agreed, Opened 5/2008, But Flagged for 30/60/90/120 days late in 4/5/6/7 of 2009, good payments since: Balance 18$/250

5.First Premier Bank, Payment After Chargeoff/Collection, Date of Last Activity Aug 2009, Date Closed April 2009.

6. Santander Consumer USA, Payed or Paying as Agrees, Opened 8/2010 Balance 27,229 (Truck Loan)

Collections:

1. Medical, Current Balance: $1464, Date Assigned Jan 2007

2. Medical, Current Balance: $367, Date assigned Jan 2009,

3. Medical, Successful PFD last week, waiting for this to be removed, Shown Balance: $1325, Date Assigned Feb 2010

4. Utility, Currenent Balance: $215, Date Assigned May 2006

5. Medical, PAID IF FULL, Date Assigned Dec 2005

6 Utility, PAID IN FULL, Date Assigned Dec 2009  (Sent a goodwill and has been removed from other two reports)

MYFICO EQUIFAX: 605

Accounts Total 7:

1. Chase Credit Card,  Pays account as agreed, Opened Dec 2010, Balance $1716$/6500 (Authorized User)(Removed as Authorized user, should refresh soon)

2. First Premier CC, Pays account as agreed, Opened Dec 2009, Balance $55/$300

3. First Premier CC, Pays account as agreed, Opened May 2008, Balance $18/250 (Flagged for 30/60/90/120 days late in 4/5/6/7 of 2009, good payments since)Goodwill Sent

4. First Premier CC, BAD DEBT/COLLECTION, Opened 1/2009, Balance 0$, Date of last activity Feb 2009 (Good Will Sent)

5. Les Schwab, Pays account as agreed, opened 5/2000, Balance 0$

6. Les Schwab, Pays account as agreed, opened 11/2000, Balance 0$

7. Santander (Truck Loan), Pays account as agreed, opened 8/2010, Balance $27,2229

Equafax Collections:

1. Medical, Successful PFD last week, waiting for this to be removed, Shown Balance: $1325, Date Assigned Feb 2010

2. Medical, Shown Balance: $1011, Date Assigned: June 2006

4. Utility, Shown Balance $215, Date Assigned, May 2006

INCOME:

Gross Yearly $55,000,  Truck Allowence $6000, Bonus Average (Able to prove with past 4 years of paystub history): $3000

SOURCE OF INCOME:  Employed at same company for almost 7 years.  Got promoted to Manager last year.

MONTHLEY DEBT: $600

ASSETS & RESERVES: $7,000-$10,000k Depending on how soon this happens.

LOCATION: Fair Oaks or Carmichael, CA. 95628

PROPERTY/VALUE: Single Family, hoping for 4 Bedroom (3 kids), around 215k. Under 1 Acre,  Move in Ready.

PRIMARY RESIDENCE

PURCHASE

My wife does not work,  She has PERFECT Credit (800+)...but no income to attribute,  I assume we will put her on the loan application, but her perfect score will make no difference.

Thanks guys!  Really looking forward to input!

[llecs]

I'm not a mortgage guru by any means but I'll throw in a 2 cents because I'm wrapping up the mortgage process.

I would aim for both scores to be at 650 or so before beginning anything. Very likely the EQ FICO would match to the one the lender pulls but there's a chance that your TU FICO will not match. In my case, my TU04 was about 30 points lower when the lender pulled it in comparison to the one from here. On the flip side, DW's was about 30 points higher when compared to TU98 from here when pulled the same day. In any case, you'll know that you will be good to go score-wise when the lender pulls if both are at 650, since your low-mid score will be in that range. Some say on here that 620 is a minimum, but the lender we worked with accepted 600, but a score that low required some extra ummmph via better assets, a larger down payment, etc.

IMO, focus on repair now via following some of the ideas in Rebuilding Your Credit board. We first met with our LO and spelled everything out. DW had a couple of unpaid collections and the LO said, "Don't worry about them. You'll never need to pay them". She was wrong and it caused a big headache and caused our credit to look worse in the process, though in the end it didn't matter. Take care of the bad stuff now.

On First Premier CCs, for the lates, start with the GWs post haste, including the CO.

PG&E - send a GW asking for deletion.

Confirm the medicals are removed. Our lender didn't require medical to be paid if older than 2 years and less than $500 in total for all, but they hurt nonetheless.

Utility#4 - send a PFD.

Utility#6 - send a GW to this PIF utility asking them to delete.

On the Chase AU, did that help your FICO score when added? I think it wouldn't have helped with an open date of last month. Our lender frowned on any new TLs. Your mix of credit looks good without it. I would be open to having it removed especially if the balance is that high. I defer to others, but I think it might impact your DTI too.

Bump for others.

[Anonymous]

Thank you for the feedback!  I will begin my GW letter process this week.  In regards to the Chase account.....Its hard to tell if its hurting or helping.  My FAKO Experian score went up a CRAZY 44 points when it registered, nothing else changed on my Experian report except my two First Premier CC were paid down to under 50$ on them, probably helping with a low DTL Ratio, but nothing to justify any major increase.  My Equafax Fico score went up 21 points when it registered.  It has yet to register on my TU Report.  But the same time my Equafax score went up, it also showed those two medical collections (currently still in dispute on my TU & Experian reports) drop off my report.  I will cancel/drop out of being a authorized user in a heartbeat if you guys think having that new Chase line is hurting.

[Anonymous]

I've decided that your probably right and that my score went up due to Debt to Credit Limit Ratios going down, and that Chase card was holding me back.  I've taken myself off as a authorized user today.  I will let you know how that effects my score.....HERE WE GO!!!

[llecs]

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@Anonymous wrote:

I've decided that your probably right and that my score went up due to Debt to Credit Limit Ratios going down, and that Chase card was holding me back.  I've taken myself off as a authorized user today.  I will let you know how that effects my score.....HERE WE GO!!!

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Be sure to pull your FICO reports to track those score changes. If it indeed helped (I really don't think it helps any), you can always re-add it.

[Anonymous]

I subscribe to Score Watch and to Quarterly Mont. here on myfico.  Hopefully it will notify me with any score change soon.  I will keep you posted.

[Anonymous]

Quick update:

Started my Goodwill Process yesterday.  I emailed a goodwill to PG&E and they called me today saying they would take it off my reports!!! YAHOO!!!

Bit of bad news though...the medicals that I disputed on Transunion (they fell off my Equafax about 2 weeks after I started the online dispute) ...TU sent me a letter saying they were varified.  What now? 

[llecs]

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@Anonymous wrote:

Bit of bad news though...the medicals that I disputed on Transunion (they fell off my Equafax about 2 weeks after I started the online dispute) ...TU sent me a letter saying they were varified.  What now? 

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That's fine. Most get verifed anyway. Take one of two steps with unpaid medical debt: 1) either send a DV to the CA. If they verify, then send a PFD. If they agree, then pay it and they'll delete, or 2) pay it to the OC. Don't communicate with the CA one bit. Then after receipt of payment, follow the HIPAA process (google HIPAA process for more info on the letters). I'd opt for #1, but that's me.

If paid already and if you had paid the CA, then send a GW to the CA asking for deletion. If paid already but paid to the OC, then either send a GW to the CA asking for deletion or follow the HIPAA process as mentioned above.

[Anonymous]

Wow that was fast!  Experian FAKO registered my PG&E account deleted today.  An increase of 12 points!  Score watch has not registered any alerts yet.  Hopefully soon for Equafax.  Which is making me begin to be concerned for my Med Debt that one of my CA agreed to a PFD a couple weeks ago...its still on my report.  I have the agreement and proof of payment....I guess I just need to keep waiting.  30 days seems to be a lifetime right now.

UPDATE:  My Equafax report updated my MED PFD...as a Balance 0 (zero).  Lame.  I've filed a dispute.  I called the CA, they said it was the CRA's fault and to file the dispute as well.  I am so frustrated.   I feel like I just wasted 2 weeks of my life....I hope this is fixed fast.  AHHH!

[Anonymous]

Got another Creditor off my report today!  It was a paid utility collection, sent a goodwill email on monday, followed up yesterday, and its off 2 of the 3 today!  Thats two paid collections Goodwilled off my Report this week!!!!   Also, no news on my Medical Collections PFD that refreshed on Equafax with a zero balance.  I was hoping this baddie would of fallen off this week (its my newest and most expensive baddie on my report)....I am hoping that PFD, once correctly updated (and gone), will give me another BIG score boost!!!

My scores had a nice increase today though. My Equafax went from 588 to 605.  And my Transunion went from 620 to 651!

Your input is changing my life!!!!   THANK YOU!