Improving Mortgage Scores

[Anonymous]

Hello, I'm trying to get approved for a home loan. I recently went to the bank for approval knowing that my credit scores (FICO 8) were high enough. Once there, I was made aware that banks use different scores to qualify people for mortgage loans. One of my scores (TU) was 50 points higher than FICO 8 but Experian and Equifax were both 50 points lower. Clearly the mortgage scores are calculated differently but I can't seem to find much useful information on how they're calculated. Does anyone have any tips on how to improve EQ FICO Score 5 or other mortgage scores specifically?

[Anonymous]

Do you have copies of your three credit reports? 

You'll get the best help here if you tell us your three mortgage scores -- the ones that presumably the bank pulled.  And the date that these were pulled.

Also helpful would be your three FICO 8 scores and the date these were pulled.  (We can make better guesses as to what might be going on in your reports if we know which bureaus have a 50 point higher FICO 8 (vs. mortgage score) and which of your FICO 8's are 50 points lower than their corresponding mortgage score.

Also helpful would be a list of your derogs for each credit bureau.  Of especial interest would be whether one or more bureaus has a collection of < $100.

Go through your reports with a fine tooth comb and look for anything that might be different between them.  For example, even if it looks like all three credit bureaus have the same credit cards, the balance listed for a card might be different at TU (say) than at EQ.  Looking for these tiny differences is really important.  It may take you several hours of going through your reports line by line to determine whether there are differences and if so what they are.  Make a list of these differences and then tell us what they are.

We'll also need a list of your open installment loans, the amount you currently owe on each one, and the amount the loan was originally for.  The way that the TU and EQ mortgage scores treat open installment loans is very different from how FICO 8 treats them.

[Anonymous]

Thanks for the reply. My scores are below, pulled yesterday. After checking again I suppose they’re not that far off but several are far enough off to make it impossible to get a loan.

Mortgage - 598 EQ, 602 EX, 660 TU.

FICO 8 - 621 EQ, 641 EX and 625 TU.

I had a chapter 7 bankruptcy 3 years ago and still have some derogatory entries on my credit, they’re closed but still negative. I have 6 accounts that were in collection before bankruptcy, they’re showing 0 balances and closed but still remain on my credit. I have no late payments for 3 years and around 35% credit utilization, about to be under 10% utilization.

I’ll go through each report and find any differences but one thing that I’ve noticed is that I have 7 accounts for student loans that are closed since I consolidated 4 years ago. Each one of these shows the same 60 days late but since there’s 7 different accounts all reflecting the same delinquencies, it’s hurting my credit much more. After consolidating those loans I’ve been current for almost 4 years.

Thanks again for the reply, sorry for rambling notes but I’m tired.