Rebuilding Your Credit

[chemical360]

So we are trying to get a mortgage and we had our lender pull our credit the middle score was 644 but it had 1 Dispute comment on it. We were told that we had to get a letter stating it was no longer disputed and we had to settle the account. The account was with MCM. We paid the account off and got the letter from them we also paid off a MRI collection that we had for $75.00 and sent the proof that it was paid off. Other then that the only negative info we have on our report was 4 30 days late on our car from when we had our baby that account is now closed paid in full. We need our score to stay the same or go up to be preapproved for the mortgage it can not go lower then 640.

Does anyone know if our score will drop. They say the rescore can take up to a week and a half and the wait is going to kill us we really just want to get the preapproval so we can start looking at houses.

[jadeite788]

the score will not drop, however I was told by my lender any disputes they will not consider me, and it can take up to 30-45 days for the dispute to come off.  I know Experian gives a date of when the dispute will be settled. I don't know about the other 2.

[chemical360]

Ya that is why we are doing the rescore. I have a letter stating that it is no longer in dispute and also one that says the debt has been paid in full. by doing the rescore they can push to get the comment off and the file updated. But they said there is a possibility that the score may drop as when something is disputed it is not calculated in the score. But I am pretty sure the dispute was closed and it was just the comment that stayed.

We have worked really hard to get scores up we went from 597 to 644 in about 5-6 months. We are so close I would hate to see it drop for this as there is nothing else that we can do only time can help us now.

[payingoffdebt001]

I have one 6yr old collection with a comment and its been there for a year - I struggle to get it removed.  I have saved my letter and made a copy of the certified receipt slip - hoping if it doesnt remove they will accept this as my proof that its not in dispute.  I believe the collection agency just wants to force me to call them and settle.  I was approved with my credit as is, just needed to get the comment removed.   I'm really trying to avoid from calling them up and settling since that is money I could use toward the house and the broker already told me this does not have to be paid but the comment must come off.  My 3rd or zilionth request to Equifax/CSC was just received by them let me see if this one does the trick since the others were done over the phone and online. 

Good luck Chemical360 looks like you will be good since you paid it and have proof.  AT least that's my opinion on it.

[chemical360]

At first I just called the CA and asked them to remove the dispute and send me a letter saying that was done. They did that without even asking me to pay. But then my broker informed me it had to be paid so i did that. now they are saying my scores may drop due to the account  being dated with new activity. We should know next week when the rescore comes back.

I recomend not paying it until closing if you need to pay it. If not wait till after you are in your house. Good luck hope everything works out for you.

[js0319]

From what I have read on the forums here - paying it off will not affect your score. What can affect your score is the removal of the "dispute" comments. In the FICO scoring model all disputed accounts are removed from the calculation, thus skewing the score. From what I gather, the scoring is based on DOFD rather than DOLA - and you paying the collection only updates the DOLA. Paying the collection was the right thing to do if that is what the lender is requesting of you.

[guiness56]

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js0319 wrote:

From what I have read on the forums here - paying it off will not affect your score. What can affect your score is the removal of the "dispute" comments. In the FICO scoring model all disputed accounts are removed from the calculation, thus skewing the score. From what I gather, the scoring is based on DOFD rather than DOLA - and you paying the collection only updates the DOLA. Paying the collection was the right thing to do if that is what the lender is requesting of you.

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Collections are not supposed to be removed from any scoring aspect.  Not even in a dipute.

If they are something was not reported correctly.