Not sure how to proceed.. help?

[Anonymous]

My husband and I are trying to buy a home. We're only doing it in his name bc I have so much in my name it would kill his dti. We submitted a pre approval app with a lender for an fha loan and his mid score was 572. He needs a 580 minimum. So they told us the collections he has and to try to get any of them deleted. We were able to get one CA to agree to delete so one collection should be coming off soon. We don't want to do anything again until his score is over 600. What course of action should we take to yield a quick gain of pts? Here is what his CR looks like

$2300- ncc business from 2015 service for a broken lease we moved out 3 months early. We will be paying this as soon as we can.
$760 for a credit union from 2013/2014 balance is incorrect but they did give us a settlement offer of $185, we may pay it, and hope they'll delete.
$160 for same credit union 2013/2014- paying this week
$530 trident asset management from 2012/2013 we don't owe this and I have filed BBB complaints, disputed etc to no avail

Then he is an authorized user on 2 of my credit cards one cap one secured opened January 2015 never late $500 limit $447 balance reported last month just paid $100 on it and will get it paid down as quick as possible.

He's also an AU on my cap one journey just got a CLI to $750 has a $671 balance but $441 reported so I'll pay it down before the $671 reports. I've had this card since February and it's never been late.

He also has a discover it secured card CL is $200 and it has a $16 balance. This is the only credit card in his name.

He has a furniture account at badcock credit limit is $1250 we owe around $1000 but it's only reporting to equifax.

I know paying down the cards he's an AU will help his score, any idea roughly how much? Should he have another card in his name? I don't know if adding something new would do more harm than good bc of his AAoA. He just really doesn't have much helping him raise his score to show on time payments except the discover card and the furniture account but that's only reporting to EQ.

[Anonymous]

With your cards so new and with such high utilization they may not be helping your husband and it may be best to just remove him.

Typically one gets the best scores with 3 credit cards (two with zero balance and one under 9%) and a loan. However since you are trying to get the loan right now he really shouldn't be applying for anything.

At this point, I think your best bet is to remove him from your cards and then use all your free money (after you pay your minimums) for him to arrange pay for deletions with the ones you haven't already taken care of.

[Anonymous]

Honestly, with credit that poor, you should really consider waiting a few years and focusing 100% on the both of you improving your credit.

If his mid score is a 580, that's very poor. I understand you may want a house now, but you're very likely to get an awful rate with scores that low.

Not trying to be negative, but taking on the huge responsibility of a mortgage while you have outstanding collections is not a good idea.

My advice? Stop carrying a balance on all your cards entirely. It's both money thrown away, and is just hurting you because it's THAT MUCH LESS that would be going towards mortgage payments. I would be pushing for PFDs on those accounts. I doubt the credit union will PFD without a paid in full offer, but it's worth a shot. The Trident account you can probably get early-excluded in 1.5 years-ish if it's from 2012.

Really though, I would not obsess over a mortgage until all your debts are paid off and you've built up his credit, and looked at getting yours under control (since you imply it is not in good shape).

[Anonymous]

I just want to clarify, I didn't imply my credit wasn't in good shape. I have around a 620 and could gain many points paying down my cards. But since there are 2 car loans in my name, student loans, credit cards, etc. it's best that I am not on the loan for our mortgage due to all of my debts.

I also didn't say we are looking right now and In a hurry. I said we submitted a pre approval and his mid score is 572, he needs a 580, but we want to wait till he has over a 600.

I know removing him from my cards will hurt, so I won't be doing that. One of my cards he is on has been open for 2 years, that's the oldest thing he has reporting so paying them down is actually the better route, which we are doing. I expect to have them both paid down to less than 50% hopefully 30% by the end of next month, one should be almost paid off. We are looking at actually buying around tax time, when we have the money down fha requires, I'm simply looking for best course of action to take until then since he only has one credit card that is actually in his name. He has 3 reporting but 2 are AU. I'm not super concerned about the collections since they are old and fha doesn't require collections to be paid. I will be paying the $2300 for the broken lease to ncc bc that is preventing us from being able to rent from anywhere that runs a credit check and we cannot stand the landlords at our current home, but we can't move due to this. We will also be paying the $160 to the credit union but the $700 something one is incorrect completely as is the trident account, that isn't even his. The $700 something one did offer a settlement of $185, that one is with tekcollect, I don't know how they are with pfd/GW. So besides getting collections deleted, I don't know if he should open any other secured cards or not, I know 3 is best and like I said he has 3 reporting but 2 are AU. I didn't need to be told how horrible his credit is, we already know that.