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Posts: 15
Registered: ‎10-13-2013
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Credit score and Home loan...

I have spent the better part of my twenties buying and spending and just really not even knowing what a credit score was.  Fast forward to my Thirties and now I am a mother and wife and have finally started to see just how important credit is.  Good news is that I did not have credit cards back then!!  Bad news is that I have them now and I am nearly maxed!!  The home that my family is living in, and we have been buying for the last 4 years, belongs to my parent in-laws.  They have now told us that hey are needing to sell quickly to refinance their own home... Problem is we are not "credit score" ready.  I have a middle score of about 580 and I really need to get that up some more before attempting to purchase a home. I have untill about Feburary before we have to either buy here or move...  I have enrolled in a credit repair program and I have made a gameplan for paying down the existing credit cards that I have. but I feel like that is still not going to be enough... Total credit card debt is about 3500.00 not to mention two vehicle loans with a combined debt of about 50,000. I have about 8 old collection accounts, all medical excpet for a phone bill....  a late payment on my student loan -but the thing is that I was still in school and that was their error.. I should not have went into repayment so soon. They put a grace back on but the late payment is still there... and I have a late payment on my car note, (my job switched their payroll agency and our checks got delayed for a week and that was the week it was due:smileysad: )  I really want t be ready by the first of the year but I have limited time.  Does anyone have any suggestions for making this process smoother? Do I pay my credit cards completely off or do I pay down to a certain point? Any advice would help!

STARTING: EX-515 TU-570
Moderator
Posts: 27,207
Registered: ‎09-13-2012
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Re: Credit score and Home loan...

Welcome to the forum.

Until is 35% of your credit score and if you've maxed out your cards! that's an easy fix. I would also start with writing GW letter for the collections accounts, car and the SL debt.

It is possible to boost your scores up in time but you need to act fast.
New Contributor
Posts: 72
Registered: ‎09-25-2013
0

Re: Credit score and Home loan...


Hannahsmom wrote:

I have spent the better part of my twenties buying and spending and just really not even knowing what a credit score was.  Fast forward to my Thirties and now I am a mother and wife and have finally started to see just how important credit is.  Good news is that I did not have credit cards back then!!  Bad news is that I have them now and I am nearly maxed!!  The home that my family is living in, and we have been buying for the last 4 years, belongs to my parent in-laws.  They have now told us that hey are needing to sell quickly to refinance their own home... Problem is we are not "credit score" ready.  I have a middle score of about 580 and I really need to get that up some more before attempting to purchase a home. I have untill about February before we have to either buy here or move...  I have enrolled in a credit repair program and I have made a gameplan for paying down the existing credit cards that I have. but I feel like that is still not going to be enough... Total credit card debt is about 3500.00 not to mention two vehicle loans with a combined debt of about 50,000. I have about 8 old collection accounts, all medical excpet for a phone bill....  a late payment on my student loan -but the thing is that I was still in school and that was their error.. I should not have went into repayment so soon. They put a grace back on but the late payment is still there... and I have a late payment on my car note, (my job switched their payroll agency and our checks got delayed for a week and that was the week it was due:smileysad: )  I really want t be ready by the first of the year but I have limited time.  Does anyone have any suggestions for making this process smoother? Do I pay my credit cards completely off or do I pay down to a certain point? Any advice would help!


First get your credit reports.  I had the same issue with my student loan. It was fixed and my credit score jumped dramatically.  Check to see if there are errors.  If there are dispute them with the credit agencies.  Furthermore if you have collections check the DOFD = date of first delinquency.. aka 7 years after they fall off your report.  Some collections can be handled with a PFD; paid for deletion.  Goodwill the car payment; there are samples of letters here.  Start to pay down the credit card debt; it has a major impact on your score.  If you have $3500 used (utilized) out of for example  $5000, your CREDIT UTILIZATION IS 70%. 


Starting Score: 525
Current Score: FICO EQ 790, TU 696, EX 683
Goal Score:
700+ across the board

Member
Posts: 15
Registered: ‎10-13-2013
0

Re: Credit score and Home loan...

Thank you! Now I see that I really need to do my homework a bit.. I did not even know you could get the late payments taken off... Had no idea what goodwilling meant..lol.  I am going to pull my reports today and post in detail tonight... that way I can be sure I am heading in the right direction... I initially just wanted to qualify for a home loan but now after reading different posts I really want to clean up my credit and shoot for an even higher score! Thanks guys!  FYI I also enlisted in the help of a credit repair business that is suppose to help with this process... is this a good idea?? Had a friend that used them and they really helped. I am  Even thinking of just letting in-laws sell and family and I move into a rental apt until we get high enough scores to get a great interest rate.... With my bad credit i really just thought it was hopeless and just shooting for an approval was good enough for me... Now I see that it is never all lost!

STARTING: EX-515 TU-570
Senior Contributor
Posts: 3,930
Registered: ‎10-26-2012
0

Re: Credit score and Home loan...

Disputing with the CRA's should be your last resort. I would recommend sending a direct dispute as it does keep from having a dispute comment place on your credit report which underwriters do not like. They will need to deal with you directly. 

 


DaBears

Member
Posts: 15
Registered: ‎10-13-2013
0

Re: Credit score and Home loan...

What is the meaning behind dispute comments?

STARTING: EX-515 TU-570
Senior Contributor
Posts: 3,930
Registered: ‎10-26-2012
0

Re: Credit score and Home loan...

Mortgage underwriters don't like them. depending on the TL on your credit report certain factors are removed and your scores are not accurate at the time of getting approved for a loan.

Member
Posts: 15
Registered: ‎10-13-2013
0

Re: Credit score and Home loan...

Thanks! That is something good to know!  When I pulled my report I noticed that I have two CC that I have never had a balance on... I opened them about feburuary and I just never used them... is this hurting my score or it isnt really making a difference if I dont use them?

STARTING: EX-515 TU-570
Senior Contributor
Posts: 3,930
Registered: ‎10-26-2012
0

Re: Credit score and Home loan...

If you have other credit cards with a small util % then no. 

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