Are mortgage scores affected to the same extent as FICO 8 when it comes to lowering utilization? I'm still working on helping my sister and her husband refinance their home with a VA loan.
Him: 577 Ex 630 TU 565 Eq
He has lates on his Cap 1 (30 day 6/16, 30 9/16, 60 10/16) and Kohl's/Cap1 (30 10/16) Last lates prior to this were 2014. Working on GW with Cap1
Utilization: $3224/3300, $857/1100, $0/300 Since the report with above scores was pulled, he has paid off the $857 and will have the $3224 down to less than 9% in July/August.
Her: 595 TU 608 Ex 581 Eq
Recent unpaid medical collection reported 10/16 and updated monthly. They have accepted a PFD and this will be removed soon.
Cap 1 late 10/16-requesting GW to remove
Also, AU on the card with the $857 balance that has been paid off.
Opened a new Amex that should report a $0 balance prior to application
I think they'll be fine to refinance in October, if necessary. That will give them 12 months with no lates and the only lates in the last 4 years being due to an injury on the job and loss of income. Trying to refi sooner, if possible. Do you think removing the CA and bringing utilization down will be enough to get their mortgage scores to around 620?
Possibly in his case looking at that utilization; probably in her case if the CA gets airstruck and that's the last derogatory outside of the deliquencies.
Utilization optimization works the same way on the mortgage algorithms as it does on FICO 8, proceed with confidence in the path you're taking to get them cleaned up and see where they stand; can do FHA at 580 though, higher than that is an overlay so there isn't that far to go unless trying for a different loan product?
@Revelate wrote:Possibly in his case looking at that utilization; probably in her case if the CA gets airstruck and that's the last derogatory outside of the deliquencies.
Utilization optimization works the same way on the mortgage algorithms as it does on FICO 8, proceed with confidence in the path you're taking to get them cleaned up and see where they stand; can do FHA at 580 though, higher than that is an overlay so there isn't that far to go unless trying for a different loan product?
And if may be that they end up FHA. They currently have a subprime 9% ARM! I'm really hoping Cap 1 comes thru! The CA already said they would delete and should have emailed her a letter this morning. DTI will probably be 25% by the time we get done with all the changes. We both are new to NFCU and they are hoping to go thru them for the refi.
Do you think hitting the 12 month mark on the lates will do anything for the scores? These were pulled in March...so less than 6 months since most recent late.
@DollyLama wrote:Mine have on utilization, even though they all have gradually increased, I will only use EX as an example, since when I first subscribed it was the 3B quarterly, I had 1 collection $34, still remains (others had some they were deleted- so I'm picking the one that remained untouched except for utilization). 2/23 report EX mortgage was 634. As of my 4/23 3B premier now pull, my mortgage score is 661. (Working on payoffs, but still not at the ultimate all report zero except 1 <8.9)
My son had a cc with $447/500 and then requested a CLI. After, he was $447/2500. His Ex jumped 39 points. I'm hoping that my BIL score will increase about 45 points since he will be going from the same high uti to less than 9% and will also go from 2/3 cards reporting to only 1
One more question. They have a pretty average credit file when it comes to number of accounts...not to thin. They had mortgage lates from around 4/13 to 12/13. They ranged from 30 day lates up to 120 day late pays in 11/13 & 12/13. With the Cap 1 late pays being recent, are they receiving any score increase on a monthly basis as the lates become more distant? I'm hoping if they are gaining 1 point a month, that, with the utilization improvement, will bring us to the 620.
@Anonymous wrote:Any thing you can do about those 120 day lates? Those pull down scores. Local lenders here would see those 120 days and walk. 90 days here is forfeclosure started nonjudicial 120 days completed.
VA does automated underwriting and that is what the goal is. Even at that, VA isn't going to walk on lates from almost 4 years ago. I'm not sure what a "pull down score" is. This is a refinance, their house was not foreclosed on. In the market we had during 2013, most lenders were not foreclosing at 120 days. There was too much market saturation and was a buyers market...which is not favorable to a lender.
@Anonymous wrote:In my market good or bad times 90 day deliquent starts foreclosure and since its non judicial it only takes 30 days so here in Small town no one ever makes it to 120 days late. Fico scores are very touchy about about things they get reported at 120 days vs 90 days. I read somewhere that 90 days late takes about 30 so points off but 120 days 50 points off. I did tons of relocation counciling and saw all the paper work from 2006 to 2010. I was paid to get people to 1) move quietly 2) dil 3) bk 4)short sale 5) don't do any thing stupid to your self or family 1 -4 were there options I just put them in touch with the final person to make it happen.
I'm not saying it can't be done that quickly, but lenders were taking years to foreclose. They didn't want the homes on their books during that time. But none of this really has to do with my questions regarding how late payments are scored within the first 12 months. I'm not worried about the old lates. I'm just trying to determine if they can get their scores up high enough before October, or if they have to wait until October.