120 day lates dropping off this year...what will happen?

[Anonymous]

I'm in the process of applying for a VA loan (already preapproved) but have some old blemishes on my report.  In 2010 I settled on a 120-day late $38,000 credit card debt for $9500.  It was paid and closed in October 2010.  I also had a $2000 card that was settled for less than its balance at the same time.  I have a 2012 30-day late utility bill showing up (I did not put the account in my name but the rentor apparently did-I never moved there) and a 30/60 late in the summer of 2013 on a home equity line of credit that was paid off last month by my stepmother who refinanced the loan in her name only.  

I'm curious what might happen to my scores when the delinquent credit cards fall off later this year.  I already have a 2.9% new car loan that I took out last month, so I don't need a car.  My EXP Fico was 700 (now 698) at the time of the credit pull for the house.  My TU Fico is 700 and last month's FICO 9 EQ was 711.  My credit card pallet is full, so I don't need new credit.  I'm 56 and disabled.  I just like to follow my numbers.  Any idea what will happen?  I've been good since 2013.  

Thanks.

[Anonymous]

The VA loan is not in any way contingent on the baddies falling off, right?

Given that, you'll have a home, a car loan, and a bunch of credit cards you like.  So you won't need your score for anything for a long time. 

If I am understanding you right, all your chargeoffs and all your severe lates will vanish.  That's great and it will be good for your score.  Since you don't need the score for anything, I'd just relax, trust that it will be good, and allow the exact amount of the boost to be a fun surprise.

PS.  In the meantime, you can explore with the folks in the Rebuilding forum getting the Day 60 removed.  That would be a nice step.  That way, when the bad stuff comes off, you will go from Day 120 to a couple very old Day 30s.

[Anonymous]

There's a chance that your 60 day from 2013 could hold back your scores from a big gain this fall when the older, more severe baddies come off.  60 day lates are sort of a common debate topic around these parts.  Some classify them as minors (like 30 day lates) and others feel they are scored more like majors.  Only you will know come fall when your majors fall off.  If you don't get a significant score boost (like 50-70 points) the reason is the 60 day late.  I agree with CGID that removal of the more recent baddies would be a smart step, so that way when the majors (older ones) come off you have a better chance of going from dirty to clean.

[Anonymous]

A couple of years ago I wrote to Bank of America to try to get the 30/60 lates removed but they wouldn't budge.  Now that the loan has been paid off, I wonder if they would be willing to reconsider.  However, there is a new HELOC in my stepmother's name, so the debt has only been refinanced.  My score didn't change when the old loan under my name was paid. The lates have prevented any change.  I've been between 683-720 during the past year.  I dropped to 683 in January when my CC debt soared to $30K out of $80K available.  I paid it off later that month and closed a couple of cards.  Now I have almost zero CC debt and $60K total limit on 6 cards.  

[Revelate]

---

@Anonymous wrote:

There's a chance that your 60 day from 2013 could hold back your scores from a big gain this fall when the older, more severe baddies come off.  60 day lates are sort of a common debate topic around these parts.  Some classify them as minors (like 30 day lates) and others feel they are scored more like majors.  Only you will know come fall when your majors fall off.  If you don't get a significant score boost (like 50-70 points) the reason is the 60 day late.  I agree with CGID that removal of the more recent baddies would be a smart step, so that way when the majors (older ones) come off you have a better chance of going from dirty to clean.

---

I think for TU 4 and EX 3 I can state 60D lates don't drop you into the derogatory scorecards and I assume that holds for the EQ and all of the models as well.

The lates still do affect you for the entire time they are on there from my data, though the lates got pushed off the reason code list for FICO 2 and FICO 3 on EX when my lien disappeared for a week... got changes when my 60D was excluded on all three bureaus, though my scores went down on EX and EQ as a result... darned bucketing!

If the 120D drops one into a derogatory bucket, I'm thinking they will get a boost when that's off assuming nothing else is keeping them there.

[Anonymous]

Yeah, so I think it would be tough to quantify the amount of points the OP could gain between dropping the 120 day late (major) and removing the final baddie (60 day).  I would think the final removal would yield the biggest gain, but going from the bucket he's in with the 120 to the other could certainly result in a solid gain as well.