CA in CO and $0 BAL on CC

Anonymous · ‎03-09-2015

i started with a 514 TU (dropped down from a 544 after paying off my car) in March of 2014. I messed up my credit, terribly, in my late teens/early 20s. I'm 27 now and just graduated. I've been repairing over the last year, slowly. I'm up to a 656 TU and just signed up for myFICO. I have two accounts in collections with one "falling off" in June/July of this year. I wasn't going to pay it since it will fall off, but will that hurt my credit? I'm paying the other off this week. Also, is Experian the only credit bureau that lowers your score for having a $0 BAL on credit cards? I pay everything on time or early and usually in full to minimize my interest payments. Please help!! My scores are 656 TU 649 EQ and 643 EX. I'm trying to build up credit so I can get good student loan interest rates for grad school loans since I won't be able to work. My goal is to break 700 in all scores. ANY advice is welcomed! I have 2 joint car loans (I pay early or on time), a personal loan, student loans (not due for repayment as I just graduated), a CareCredit credit card with $500 limit (joint), a credit union credit card with a new $1500 limit (joint), a capital one credit card $1500 limit (my spouse is an authorized user), and JUST got another capital one credit card with $10,000 limit that hasn't hit my credit report (not joint and no auth users).

RobertEG · ‎03-09-2015

Exclusion of a collection removes the ability of a party to become aware of an unpaid debt by seeing a collection in your credit report that remains open and unpaid.

However, once the collection is excluded, that does not discharge the debt.

Yes, credit report exclusion will place a basket over the unpaid debt, making it more difficult to discover, and will also remove negative impact on your credit score.

However, in the bigger context of possibly continuing to harm your credit, it could still become basis for credti denial.

Many creditors will, for example, request disclosure of any unpaid, delinquent debt as part of the credit application process.

That is particualry true of mortgage lendors.

Anonymous · ‎03-09-2015

So you're saying even if it "falls off" it doesn't actually go away? I had a student loan charge-off last year and it was removed from my credit report giving me a 50 point boost. I haven't seen it anywhere but you're saying when taking a mortgage loan, the report they pull will show that? I don't plan on buying a house for a while (because of school) but that's interesting to know.

Anonymous · ‎03-09-2015

@Anonymous wrote:
So you're saying even if it "falls off" it doesn't actually go away? I had a student loan charge-off last year and it was removed from my credit report giving me a 50 point boost. I haven't seen it anywhere but you're saying when taking a mortgage loan, the report they pull will show that? I don't plan on buying a house for a while (because of school) but that's interesting to know.

The pull potentially can show it - not 'will'. Whether it shows up or not is dependant upon whether the lender pulls a standard tri-merge report or a more expensive 'full factual' report, which may show such excluded items. In the six months I've been reading this forum, I've yet to hear of a single person reporting that they were *actually* turned down for a mortgage because of an excluded item showing up because the lender pulled a full factual report. So it would seem that this is an exceedingly RARE event. My thoughts are that the full factual report pull is *probably* something that only occurs when applying for whats commonly referred to as a 'jumbo' loan (well over 400K). The FCRA langauge that allows the excluded items to potentially show up refers to "loans in excess of 150k" - but FCRA was drafted in the 70's, when a 150K loan was considered a very large mortgage.

Anonymous · ‎03-09-2015

Wow, thanks for the info! I am monitoring to see if it actually "falls off" this year. I'm hoping the new $10K credit card will give me a nice boost. Is 10 percent utilization the most recommended?

Anonymous · ‎03-09-2015

Yes, below 10% reported balance is recommended. You can certainly use it more than that, just pay it down before the report date. With Cap One thats usually the statement date.

Anonymous · ‎03-09-2015

Thank you!!

RobertEG · ‎03-09-2015

FCRA 605(b) specifically exampts all of the normal credit report exclusion provisions of section 605(a) if a party requests your credit report in consideration of a request for credit or insurance in the amount of $150K or more.

No, adverse information is not deleted from your file after expiration of the credit report exclusion period. The CRA is barred from (normally) including the information in credit reports they issue.

Norman is correct in the observation that creditors rarely request full factual credit reports. I have seen several posts wherein a mortgage lendor did so, but it is admittedly rare. Most lendors seem to simply rely upon a request for disclosure of any unpaid, delinquent debt.

However, the fact remains that they can obtain a credit report that includes the normally exlcuded derogs.