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12-27-2012 11:31 AM
I have been rebuilding my credit for several years following 4 years late payments due to financial issues resulting from medical bills. I've been working with a credit repair company. At this point they have cleaned up all they can. My credit score went up 135 points but I still am not there yet. 650 EX, 650 TU, 590 EQ (average score 630). However, I've been told that those scores are on the 850 scale, not the 950 used for a traditional mortgage loan. On that scale I'm averaging at 590 - too low for a mortgage.
I have no debt, just paid off my car loan. I have no credit car balances, credit limit of 5K. I have 20% down payment saved. I have no idea where to go next. There are 2 public record items on my account that are hurting me. Both were lawsuits of 5K eacah. But I won both in court and owed only court fees of $92 - 200. Both were paid. However, i cannot get them off my record.
Any idea what to do next to move up my score - or do I simply need to wait and continue to play on time?
12-27-2012 07:21 PM
You appear to be mistaken on how your credit scores are used for mortgage purposes. First, it is the 850 scale that is used for scoring. Second, and more important, it is your middle score that is used, not the average of the three. So, for you, your middle score is actually 650. (650, 650, 590). Where have you been getting your scores from?
The judgments are very confusing based on your post. Please elaborate. If they are on your reports, but innacurate, then you should be disputing them.
How many inquiries do you have? How many are within the last year?
12-27-2012 09:05 PM
I agree, a judgement in your favor should not be reported. You need to call the county/court that is reporting this information and ask to have it removed.
A 950 scale is not used for mortgages, FICOs are used for mortgages. I would recommend buying both on this site and finding out real scores. The ones given to you by the credit repair company are likley FAKOs.
If your scores are that good, you should easily be able to get a mortgage as long as you have no outstanding leins/collections/child support etc. Getting FHA should be a cinch. Most lenders only need a 620 or 640 mid score, with some as low as 580. I would advise you to call local banks in your area (not national banks like US Bank or Wells Fargo) and finding out their requirements. Usually they want 2+ years at current job, low DTI, down payment saved, 3 months reserves in savings, last 2 years tax filings, recent paystubs, and a few other inicdentals.
Don't short change yourself, you have worked hard to get where you are, and you should be able to live the American Dream. Best of luck and kuddos to you for doing this the hard way!
12-28-2012 11:40 AM
Thanks for the encouragement!
The judgements were filed in civil court and both lawsuits were 5000 (the max in civil court). One was with a landlord, the other with a dentist. I tried to work with both of them prior to the suits, but they were not interested. So we went to court. i was found to only owe the cost of a screen door with the landlord - where he owed me my deposit back. With the dentist, we owed only the remaining bill, instead of work he quoted but never completed. But both went on my public record. We disputed - one was just removed yesterday - still pending the other.
I have three total inquiries in the past 3 years - 2009 car loan, 2010 mortgage inquiry, 2011 credit card.
I'm really confused about the loan issue. I met with a broker yesterday because I thought I had enough to get approved for FHA. She told me the scores that I pulled on my credit report (from freecreditscore.com) were on the 850 scale and that's why they were higher and that they used the 950 scale (this is a credit union). So I came home discouraged and signed up here. My scores were different. With freecreditscore, they were TU 650, EX 650 and EQ 590. But here, they were TU 605 and EQ 580 - not sure about EX. I don't want to pursue FHA if there's not a change of getting approved because it will hit my credit report.
I paid off my 6 year car loan in 3 years - have no debt, 20% down payment, and have been at my job for 25 years and make more than enough to afford a mortgage. It's frustrating when things from 5 years ago are still preventing me from getting a home for my family.
What is the likelihood of an FHA approval with scores like that? I'm probably looking at a mid score from EX around 590.
12-28-2012 02:16 PM
I'd work on getting your scores up a bit first. Freecreditreport.com is a FAKO. Most mortgages pull a standard mortgage model.
12-28-2012 04:30 PM
Getting those judgements deleted will help. Altho it sounds like they are legitimate reporting if you were found to owe even a small amount. You could pay to file for the attorney who sued you to vacate those, but not all will agree to do it. I also think that having no debt might be hurting you. Do you use your credit cards? If not, start using them here and there and paying them off (you can leave a 5-9% balance on one to bump your score up) and that should give you an increase. I would find out the minimum score requirement from the bank, and try to wait to app until you have a decent cushion due to flucuation (if the score needs to be 620, I would shoot for 640 before I apped). It seems to me that EX and TU are the higher of the three scores. Work on getting inaccuracies deleted. Any inquiries prior to 2011 should not be reporting. I would highly recommend you monitor both your EQ and TU on this site in the meantime. Keep in mind, the TU on here is 98 version, and the bank likley uses 04. In our case, 04 is a better score, and 08 is the best, but most of our baddies are old. If your baddies are new, 98 will give you a better score than the newer versions. EQ score on here is the same one used by most banks. Stick with it, you will get a house in 2013 if you work for it!
12-28-2012 04:55 PM
If the judgments are less then 1 year old, you will be denied for an FHA mortgage. If they are less than one year old, they are also hurting your scores significantly. It is highly unlikely you will get approved with credit scores in the 580 range. If you have 3 open credit cards now, do not open any more. If you have less than 3, open up another one or two, so that you have a total of three, IF you have six months to go before applying for a mortgage.
Do you have any paid collections showing on your reports? Have you received hard copies of your credit reports to see what negative items are being reported?
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