topic Re: Home Refinance in Understanding FICO® Scoring

Home Refinance

Anonymous — Thu, 08 Mar 2018 20:15:38 GMT

We are working with a local bank to refinance our home with them. In the middle of January, we had them pull a trimerge credit report. At that time they went over things that we could do to increase our credit score. At that time, they suggested completely paying off any store card such as Amazon/Nebraska Furniture Mart/etc. We did that. We also reduced the % of credit card usage down to 36% from over 70%. We made sure that all cards where below 50% utilization except for one that is a revolving account with Wells Fargo. We had them pull credit again on March 6th to see if everything was showing up. We noticed an increase on 2 of the bureaus (EQF went from a 663 to 701, EXP 592 to 648 but TU went from a 688 to 665.) We did not add any new credit lines or have any derogatory information appear on the bureaus. We are scratching our heads to try and figure out why there was such a drop with TU. We are also wondering the best and fastest way to get the scores up over 720. Since the pulled the bureau, we have reduced the Wells Fargo account down to 28% utilization and that is the highest of any. We also paid off 2 smaller cards that had $500 or less balances on them.

Re: Home Refinance

Anonymous — Thu, 08 Mar 2018 21:26:50 GMT

Is it possible for you to pay all cards to zero except one, with the remaining card reporting a small positive balance? That is the simplest and fastest way to see a score increase.

PS. You should not have your mortgage lender pull your score as a method of finding whether CC balances have changed on your reports. Reports are free, but every time your mortgage lender pulls your reports it results in a hard inquiry.

Re: Home Refinance

Anonymous — Fri, 09 Mar 2018 00:24:11 GMT

We might be able to do that. I will have to look and see what the balances are. Do we only card about the CC balances not stuff like Wells Fargo Home Improvement card or do we need to care about those too?

Re: Home Refinance

RobertEG — Fri, 09 Mar 2018 17:23:49 GMT

When you say that you have no derogs, do you mean that your payment history is totally clean, or do you mean that no new derogs were added?

If you have an existing delinquency, a score impact can come about if they report a monthly update showing continued delinquency.

Re: Home Refinance

Anonymous — Sat, 10 Mar 2018 22:49:00 GMT

Any delinquency is extremely old. There are no current derogs on the credit file. Are all revolving accounts treated the same as in are credit cards treated the same as like a Wells Fargo Home Improvement account?

Re: Home Refinance

Anonymous — Fri, 16 Mar 2018 04:34:13 GMT

The bank was going to repull credit to see if the score went up. I am going to guess that is the totally wrong thing for them to do. Should I instruct them to contact the scoring company and have a rapid rescore done?

Re: Home Refinance

HeavenOhio — Fri, 16 Mar 2018 05:26:12 GMT

This looks like the Wells Fargo Home Projects card. If that's the case, it's a credit card and the high balance would be hurting you.

Ideally, because it's a retail card, it'd be best for this one to have a balance of zero, with a major card being the one to report the small balance. That's because some have reported that retail cards don't offer the same AZEO benefit that a major card does. If paying this off isn't possible, you could bring your other cards to zero and leave a balance of less than 29% on the Wells Fargo card.

As far as the lender pulling your credit, the inquiries would add up if they're spead out over more than a very short period, possibly as short as 14 days. Someone else would have to fill you in on the specifics. You'd be better off subscribing to myFICO and paying for whatever scores you need. When you pull your own credit, those are soft inquiries that don't hurt your score.

Re: Home Refinance

Anonymous — Fri, 16 Mar 2018 14:43:35 GMT

We paid this one down below 30%, but still have some other cards with balances too. We are working on getting those down, but not there yet.

Re: Home Refinance

Kree — Fri, 16 Mar 2018 14:55:03 GMT

@Anonymouswrote:
The bank was going to repull credit to see if the score went up. I am going to guess that is the totally wrong thing for them to do. Should I instruct them to contact the scoring company and have a rapid rescore done?

There is a timeperiod where mortgage pulls count as 1. I think 45 days. Could be wrong. Someone might have more accurate dating.

Re: Home Refinance

Anonymous — Fri, 16 Mar 2018 18:30:57 GMT

I just don't think that repulling credit to see if it has updated is the correct way to do it. I would think that forcing a rescore might be the better way.

Re: Home Refinance

Anonymous — Sun, 18 Mar 2018 22:31:34 GMT

I think what others are trying to say is that you should put

the refi company on hold for the time being. So they do not hard pull each time.

That could/probably is, hurnting your score somewhat.

Then, YOU personally keep an eye on your scores, since it would be soft pull and no harm.

Then when your scores are where you want them to be, i.e. 720 or whatever,

then you can let the refi company do their hard pull to get the deal done.