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@Anonymous wrote:
Hey everybody just have a quick question to which I've been unable to find an answer on. I have been working on my credit for two months now and after a visit with my broker I was excited to find out that I'm just shy of approval by 28 points. Since then I have successfully "paid to delete" two collection accounts that were reported about four months ago totaling over $600.00. I know it varies greatly but how much do collection accounts really affect your score? Think I'll get the 28 points? I also had my fiance who has great credit add me as an authorized user on one of her oldest cards with a very low balance and 0 late payments...Thanks in advance...
Welcome to the forums.
No one can say for sure just how much this will help but having two recent collections removed usually means an increase. Alot depends on what the rest of your credit is like. Do you have any more negative items? Is your revolving utilization low?
Optimal credit utilization for FICO scoring purposes seems to be:
Total revolving utilization > 0 and < 9%, the lower the better, and
Reporting a balance on less than half of your revolving TL's, and
Reporting a balance on half or less of all TL's.
Being added as an AU can help you IF the account is older than any of yours, IF the payment history is long and clean, IF the utilization is very low, and IF it will report to the CRA's. Not all cards will do this. You need to ask the company first. You will inherit the entire history of this account. One caveat however; if this account starts to go south your credit will be affected as well. Keep that in mind.
Good luck to you.
From a BK years ago to:
7/09 TU-742 EQ- 779
8/09 TU-765 EQ- 783
9/09 EX pulled by lender 802
You can do the same thing with hard work.
A collection is a major derog. Two CAs are a double derog.
I can estimate, in all good faith, that removing the CAs will easily add at least 40 pts to your score. So, yes, I predict that you will easily get the 28 pts of your dreams.
Just make sure that they follow through, and actually delete the CAs from your CR. It wont enter into FICO scoring until they report the actual deletion to the credit reporting agencies.
As for AU status, it will probably help your FICO score, but probably wont impress your loan officer much. He/she knows that it is not based on your proven credit history.
Is your mortgage app only in your name, or are you applying jointly with your fiancee?
Thanks so much for the reply I cant seem to find too much on how collections play into things....
I have two more negative items other than the ones mentioned. One is a charge off for approx 1800.00 and the other is a few late payments on an account but it has been paid in full years ago. Both of the accounts are very old and are scheduled to drop in 2013. I have two credit cards and both are under 10% of the limit with a years worth of ontime payments each. Everything else is in great shape and current...as for my fiance, her account that I am now added to is older than any account I have and we just paid it down to approx 11% of the limit. The only account with a high balance is my new car in which i have only made 3 payments but it is current as well...do collection accounts count for quite a bit because given my situation I sure hope so...LOL. I also forgot to mention I tried to do a pay to delete on the remaining negative (1800.00) but they refused so this is my only hope of freeing up some points quickly.
I was not aware, in my prior post, that you still had a major derog pending in your CR for a charge off (CO) by the original creditor (OC) on another account.
That should be of major concern to you. The OC could choose, at any moment, to refer this unpaid debt to a collection agency (CA), who would then have the right to post a further derog to your credit report. That could wipe out all of your prior FICO gains.
What is the DOFD with the OC on this CO?