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My credit was very good in my 20s and then I ended up with some bad real estate investments around 2008. Long story short, my husband and I filed for CH13 bankruptcy. We then moved to a new state for a new job, sold our house and rented for a few years. Our CH13 was discharged in August of 2016 and we were able to get a mortgage to purchase a house in September 2016. I have the following accounts in good standing:
Mortgage: $304,000 @ 3.125% interest, which is awesome. However, we are having to pay ~$200/mo PMI even though we put 20% down due to needing an FHA loan because of the CH13.
$60,700 in student loans
Credit One card opened Nov 2016 - $600 limit
Kohls Card opened Dec 2016 - $600 limit
2 hard inquiries - July 2016 (mortgage) and Sept 2016 (US bank - denied card)
Income is $100K+
In the last year my:
Equifax score has gone from 696 to 701
TU score has gone from 682 to 692
Experian score has gone from 682 to 694
Am I crazy in thinking that the score should be going up a bit more or is this just par for the course with my CH13?
I'm scared to apply for other cards in case I get turned down and make my score worse. I tried for a GAP store card in June of this year and was denied.
My goals are to have a good rewards card (I live in Alaska so would really like the Alaska Airlines Visa) and to be able to refinance my mortgage into a conventional loan to drop the PMI before interest rates go much higher.
My CH13 filing date was June 2011 with discharge in Aug 2016. Does this mean that it should come off around June of 2018? Should I just sit tight until then or is there something else I can do to speed up the credit score process?
The exclusion of a Chapter 13 BK is no later than 7 years from the date of filing (i.e., the "date of entry of the Order for Relief").
It seems to me, from what I've read on these boards, that you have established the initial credit lines necessary to rebuild. Have you looked at the thread on BK7-700? I know you are a 13, but the same steps should help. I am also a Ch13 rebuilder. We were just discharged in April 2017. If you don't mind me asking, how were you able to get a mortgage so quickly? We were under the impression that we could get preapproval on an FHA loan but we were denied in August. Did you have to go to a few lenders? Did you have to jump through any hoops? Our DTI ratio is fine. Our salaries are good. Unfortunately the only thing reporting to the credit bureaus are our student loans...our mortgage, while paid monthly and on time, are not reporting. Any advice to us, since you and I seem to be similar?
Hi there -so sorry for the late reply, I haven't checked these forums in awhile. I was actually surprised we were able to get a mortgage as well. We only worked with one broker and we had to wait to have the CH13 dismissed before we could close. I think we had to write a letter explaining why we were in CH13 for their underwriter. We also had a large downpayment so maybe that helped?
@akrock
First of all, Congratulations on your rapid recovery from BK13!
FICO scores in the high 600s and low 700s are solid scores
that will open doors for you and continue to rise over time.
In response to your direct question about why you're so surprised
that your FICO scores haven't risen even higher than you expected,
there are three (3) forces affecting your overall scores right now:
1) new accounts, 2) new debt, and 3) overall age of your accounts.
Although you have enjoyed a rise in your scores, all 3 of these factors
hitting you all at once are suppressing your scores in the short term.
However, with time and with continued responsible use of all of
your accounts, your scores will keep rising. It's about patience and
discipline. If you lack one or both, then auto pay should become your
new best friend. You know the drill: login to your bank, input the data
for all of your bills, and then set it and forget it. Time will do the rest.
BTW, your BK13 will naturally fall off all three credit reports seven (7)
years from your BK filing date. So you are correct: if you filed in Jun 2011,
the the BK will fall off in Jun 2018 (this month - Congrats once again!)
Numerous myFICO forum members have reported an 80 to 90 point boost
in their scores when BK falls off. So your high 600's and low 700s will become
high 700s and low 800s. Not bad, huh?
I should point out that I'm also a fellow BK13 filer. I'm 4yrs and 4 months
into my 60 month payback. My FICOS began in the 400s, but they are now
in the high 500s and low 600s. It's all about progress and time, akrock.
Please continue to keep us posted on your progress. Your example is
inspiring to me, and I appreciate you taking time to share with us.
It won't be much longer before my scores are in the 700s as well.
Thanks for posting, and Good Luck to you!!!!
P.S. The optimum number of revolving accounts FICO loves is 3.
In your case, you have one credit card (Credit One) and one store
card (Kohls). When you establish one more revolving account,
your scores should rise faster over time. If you haven't considered
membership with Pen Fed, I would strongly consider it. Yes, they will
hard pull your Equifax, but it's for both membership and all of their
risk based products. Even better, their hard pull is good for up to 90
days. You don't have to be military and/or a veteran to qualify for
membership, and they'll be happy to discuss your situation in more detail.
P.P.S. Pen Fed offers a Power Cash Rewards card that pays up to 2%
for all purchases. Check out their website and/or call for more details.
If you're an Amex fan, Pen Fed's Pathfinder Rewards is their flagship card.
25k bonus points for a $2,500 spend, up to 4x points on travel, and 0% APR
for the first 12 months. Lastly, the Pen Fed Promise is their most popular
card and the easiest to qualify for. Many myFICO members who have this
card report a 650 Equifax for approval. So if you want to play it safe and
you're inquiry averse, then the Promise card would be your best bet...
Thank you for the nice words!
My Ch13 did drop off this month and at a glance (according to credit karma, which I know isn't necessarily accurate), my scores did shoot up overnight. Transunion is the lowest around 725, Equifax around 770 and Experian in the 800s! I am going to plan to pull my free reports from all 3 before I apply for anything to make sure that all the bad things are gone. Think it's worth it to pay for the product offered by myfico that gives me all the scores as well? Or should I rest assured that if the reports look clean I'm probably good to go?
My ultimate goal is to have 1 or 2 rewards cards that I can put almost all purchases on every month and then pay off multiple times per month. I have a lot of expenses so I figure this will help me rack up the rewards quickly. However, I have NO idea which ones to apply for! Do I just bite the bullet and pick one?? From what I've been reading, they all look at credit profiles and not just the scores, so I'm trying to figure out which one I have the best chance of getting.
I checked into refinancing my house and mortgage rates have gone up enough to where it makes more sense for me to keep my low low rate and PMI.
I do want to purchase a new (used) vehicle this fall, so I'd like to apply for a credit card now so that it will show a little time between it and my car loan.
I will check into the PenFed card you recommended - thanks for the tip and good luck with your journey!!
After going back and forth and hemming and hawing over which card to apply for, I bit the bullet and applied for my one pre-qualified offer from Capital One (Quicksilver) and was immediately approved for a $15K limit!
It's not the exact card I wanted to maximize rewards, but it will work for now while I continue to rebuild.
Just had to share my good news!