topic Re: Trying to raise my score with a 120-day late account in Understanding FICO® Scoring

Trying to raise my score with a 120-day late account

Anonymous — Thu, 06 Jan 2011 17:50:52 GMT

Hey Friends...I am trying to build my score.....I have a TU Score of 615 with a 10 Year Credit History

About a year and a half ago a account went into a late status

- First Premeir Credit Card: It was 120 Days in July of 09. It was Paid in full and has been kept current (with Zero lates since then).

I read that a 120 day late can be just as bad as a bankrupcy. Is this true?..and will my score recover as it ages like other dings? And any idea how much time/increase I can expect?

Also, my wife added me as a authorized User on her $6500 Chase Visa Card. It has showed up on my FAKO Experian Score (was 520) and boosted it over 40 points (now 564). It has not been reflected on my FICO TU & Equifax scores yet ....do you think the similar addition will happen to my TU (615) and my Equifax (567)? I am trying to break the 620 Threshold to buy a house...so I am watching my credit like a hawk now.

Finally... I got a Auto Loan about 5 months ago...and was told over time, with solid payment that will also help my score. Any idea what kind of increase (if at all) over 6months/year of good payments? Any other suggestions to continue to build my score?

Re: Trying to raise my score with a 120-day late account

cdtotten — Thu, 06 Jan 2011 18:51:18 GMT

You are correct that a 120 day late on your credit report is considerer a major dergotory... along the lines of a collection, or charge off account. It is having a severe impact on your score, and will so until it is removed. Each late annotation, the 30 day, 60 day, 90 day etc. will remain on your report until 7 years from the date of the delinquency. Like all derogs, it's effects will lessen over time. Most people seem to see a lessening on the yearly anniversary date of the derog.

Being added as an AU is a positive thing for you if the card has a long, clean history and has little or no utilization showing. Keep in mind that FAKO scores have no correlation to your real scores, so don't use those trends as a reflection of what has happened to your true FICO score.

If your auto loan is the only installment loan you have, then yes adding it would help your fico score by giving a better credit mix. Installment loan utilization doesn't really pay much into your FICO score, so I wouldn't expect a big jump or anything after 6 months or a year, other than the inquiry disappearing and your increased AAoA.

My suggestion is to try to goodwill the late payments with the OC. You will have to do a lot of explaining to your mortgage underwriter about that kinda late payment. I would also suggest pulling your EQ score here to get a good feel of where you stand overall. Don't bother pulling yout TU, as it is not the same scoring formula that your lender will be using.

Re: Trying to raise my score with a 120-day late account

Anonymous — Sat, 08 Jan 2011 09:47:49 GMT

The quickest and easiest way to give a boost to your scores is if you can add long-term, clean history via AUs from your wife.

If your wife has any other open credit cards that meet these criteria, then I would have her add you as an AU as well:

1. A clean payment history

AND

2. Open date older than your AAoA (Average Age of Accounts)

If you're looking for more eyeballs and help, there are two other forums that are a great place to get help:

Rebuilding Your Credit -- There's a ton of people who are going through exactly what you are right now
Mortgage Loans -- There's some great people who post there, including some loan officers

I hope that helps.

Re: Trying to raise my score with a 120-day late account

RobertEG — Sat, 08 Jan 2011 23:52:25 GMT

One favorable thing I notice about this old 120-day late is that you say it was paid back into good standing.

You were right on the fringe, at 120-days late, of the OC closing the account, doing a charge-off, and maybe additionally referring the debt to a debt collector.

The fact that the OC account remained open is a good sign that might indicate favorable consideration of a GW.

Re: Trying to raise my score with a 120-day late account

Anonymous — Wed, 19 Jan 2011 02:33:16 GMT

Thank you everyone for your help! My FHA Mortgage officer said I need my Mid Score to pass 600. My Mortgage officer says that the lates and the collections are easy to explain away for my scenario. Plus I have a great Job history that really helps. Currently my scores are:

TU 620

EQ 588 (12 FRICKIN POINTS OFF!!!)

EX (FAKO, I KNOW) 567.

All Those Lates will be approaching the 2 year mark in a couple months ....and yes the Credit Card that was 120 late is now "Paid Or Paying as Agrees" . Everything else is in order...low debt to limit ratio, paying everything ontime....just OLD collections from a crazy ex wifes medical (anxiety) bills. LAME> And the Car payment is at 6 months this month and is my only installement loan.

Re: Trying to raise my score with a 120-day late account

llecs — Wed, 19 Jan 2011 09:05:58 GMT

To add, the 120 damage will fade over time. It may have been suggested already, but I would send GW letters to First Premier asking them to remove the lates. I'd tackle the CAs too as those can easily be hurting your FICO scores 100+ even at or near 7 yrs. The new car loan is hurting too, though most of the damage of adding it will fade between now and the one-year mark.

Finally, some lenders pull the same TU version as found on here (TU98) and others pull a newer version not found anywhere but from the lender. I'd aim for a 650 on TU just to be safe. For some, the TU score pulled by the lender is lower than the one from here, which may knock you out of contention (for TU anyway). But others actually have had higher TU scores than what was pulled through here. YMMV based on your credit profile.

ETA...and as you know, ignore the EX FAKO. You can easily have a 500 EX FICO at this point, or even a 650 EX FICO. The FAKOs out there can easily be 100+ points off from the real deal. I'm in the middle of the mortgage process myself and what worked for me was to ignore EX entirely (other than repair) and subtract 30 points from my TU FICO. I'd then take the lower of the EQ or TU FICOs (after subtracting 30) and used that lower score as an assumption for my lower mid-score. In your case, it is save to say that your low-mid score will be at least 588.

Re: Trying to raise my score with a 120-day late account

Anonymous — Wed, 19 Jan 2011 17:05:03 GMT

I think that is great advice...at this point I am subscribed to score watch on MyFico Equafax...and I am using that Score as my Middle Score, and your right, it currently stands at 588.

I am hopeful that this score will surpass 600 in the coming weeks/months. The wait is lame. My past was lame. But the future is bright!

Another question. I disputed 2 medical collections (they were my ex's)....both from the same CA. Both have dissapeared from my Equafax report, but they are currenltly still on my TU report showing that they are being disputed... Should I get my hopes up that they are going to drop off my TU report....which seems to update REALLY SLOW. TU report still has not showed my Chase card with a limit of 6500! And I am subscribed to FICO Quarterly Monitering for TU. Or is Equafax going to trick me and have them re-post later?

Re: Trying to raise my score with a 120-day late account

Anonymous — Thu, 20 Jan 2011 00:40:56 GMT

So...I saw some Collections on my report......

Feb 2010: Medical, $2310

June 2006: Medical, $1011

Dec 2009: NON MED, PAID!!!

May 2006: NON MED, 215$

Would a PFD help my score if I got rid of the 2010 Medical for $2310? The company has agreed to do a PFD. But I would have to pay it today.

Re: Trying to raise my score with a 120-day late account

llecs — Thu, 20 Jan 2011 05:45:26 GMT

@Anonymous wrote:
Another question. I disputed 2 medical collections (they were my ex's)....both from the same CA. Both have dissapeared from my Equafax report, but they are currenltly still on my TU report showing that they are being disputed... Should I get my hopes up that they are going to drop off my TU report....which seems to update REALLY SLOW. TU report still has not showed my Chase card with a limit of 6500! And I am subscribed to FICO Quarterly Monitering for TU. Or is Equafax going to trick me and have them re-post later?

They can re-report later on EQ, but with a condition that EQ notify you before they do so. It's also possible for the CA to sell it to someone else and they can report, though odds are it is gone forever. TU is always slow.

Re: Trying to raise my score with a 120-day late account

llecs — Thu, 20 Jan 2011 05:49:10 GMT

@Anonymous wrote:
So...I saw some Collections on my report......

Feb 2010: Medical, $2310
June 2006: Medical, $1011
Dec 2009: NON MED, PAID!!!
May 2006: NON MED, 215$

Would a PFD help my score if I got rid of the 2010 Medical for $2310? The company has agreed to do a PFD. But I would have to pay it today.

Whether paid or unpaid, $0 or $10,000, the damage to your FICO score is the same per CAs (and COs too). You'd want it off. If they are open to a PFD, then take it, though you'd want that agreement in writing (you can always fax or even e-mail back and forth).

Re: Trying to raise my score with a 120-day late account

Anonymous — Thu, 20 Jan 2011 16:30:22 GMT

Yes...the deal is a PFD. I got the agreement in writing via email....I paid the second I read over and confimed the email. In a matter of days/weeks it will be gone!!! Between that PFD and the Deleted accounts from my disputes, that is over 4 Thousand dollars in Medical bills that are gone from my report. I really hope this puts me in the running for a FHA loan!!!

Re: Trying to raise my score with a 120-day late account

Anonymous — Wed, 26 Jan 2011 18:18:48 GMT

Old open accounts are a problem when you apply for a mortgage. If you can pay them off on the condition that it is completely removed from your credit report, this is best. Get it in writing before you send any money. Don't pay them (or make any payments to them) unless they do agree to take it off. A payment now, without such an agreement, will make the debt current based on latest activity.

You'll need to pay it off to receive an mortgage, but wait to speak to your loan officer. There are other ways of paying them off.

Your car loan will start to look better after a year.

Is there a particular reason why you were added as an authorized user vs. being added to the card as a co-borrower?

Don't open any new credit lines or make any major purchases prior to closing on your mortgage.

Re: Trying to raise my score with a 120-day late account

Anonymous — Thu, 27 Jan 2011 16:24:24 GMT

"Don't bother pulling yout TU, as it is not the same scoring formula that your lender will be using."

I didn't realize there was a different formula for the TU score that a lender pulls. Is the score that the lender gets typically higher or lower? Thanks!

Re: Trying to raise my score with a 120-day late account

Anonymous — Thu, 27 Jan 2011 17:30:36 GMT

TU scores range from 501-990. FICO scores run from 300-850. The formula is totally different.

As a mortgage lender, we pull the FICO mortgage edition. I don't believe this is available to the public. Buying 1 FICO score will tell you if you are in the ballpark. Most mortgages now start at 640. Once you're in range, see a lender.

Re: Trying to raise my score with a 120-day late account

MarineVietVet — Thu, 27 Jan 2011 17:38:14 GMT

@Anonymous wrote:
TU scores range from 501-990. FICO scores run from 300-850. The formula is totally different.

As a mortgage lender, we pull the FICO mortgage edition. I don't believe this is available to the public. Buying 1 FICO score will tell you if you are in the ballpark. Most mortgages now start at 640. Once you're in range, see a lender.

Actual Transunion FICO scores are 300-850. What you listed is what is called a VantageScore and that is NOT a FICO score. Very, very few lenders make decisions using a VS.

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 10/10-813, TU - 10/10-774

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

Re: Trying to raise my score with a 120-day late account

Anonymous — Thu, 27 Jan 2011 18:02:59 GMT

For me, my mortgage pulled Equifax FICO Beacon 5.0, and it was identical to the Equifax FICO score pulled here.

I tracked my EQ FICO score here while I was prepping for our mortgage and it was quite helpful.

joshua - For expert mortgage advice, including how to handle accounts on your credit report prior to your app, you may want to post on the Mortgage Loans forum. There are lots of mortgage experts there with FICO savvy to help you through the process. You'll find lots of great reading there, as well, that may be very helpful to you as you move forward.

Best wishes!

Re: Trying to raise my score with a 120-day late account

Anonymous — Thu, 27 Jan 2011 18:10:50 GMT

Thank you Beam...I've spent countless hours reading up on those Mortgage posts. I will probably post my information very soon and see what the Mortgage Guru's have to say. The LO I am talking to locally seems pretty positive about my Pre-Approval, the simple hangup he claims is getting my Fico Equafax from 588 to above 600. My Fico TU is 620 and all simulations for my current actions seem to put my Fico Equafax above 600 in the coming weeks/months.

Re: Trying to raise my score with a 120-day late account

Lel — Thu, 27 Jan 2011 18:23:33 GMT

@Anonymous wrote:
"Don't bother pulling yout TU, as it is not the same scoring formula that your lender will be using."

I didn't realize there was a different formula for the TU score that a lender pulls. Is the score that the lender gets typically higher or lower? Thanks!

As mentioned by llecs in post #6, there are still some lenders that use TU98. The transition to the newer version of TU is far from complete. It is unfortunately not possible to predict whether your TU04 score will be higher than, lower than, or similar to your TU98 score.

Re: Trying to raise my score with a 120-day late account

Lel — Thu, 27 Jan 2011 18:34:50 GMT

@Anonymous wrote:
TU scores range from 501-990. FICO scores run from 300-850. The formula is totally different.

As a mortgage lender, we pull the FICO mortgage edition. I don't believe this is available to the public. Buying 1 FICO score will tell you if you are in the ballpark. Most mortgages now start at 640. Once you're in range, see a lender.

Many people here have reported significant differences in their FICO scores. Part of the this is due to differences in the scoring models among the credit report agencies, but sometimes it's due to differences in the information contained at each credit bureau. For example, there could be a negative entry at EQ but not at TU or EX. Thus, it is important to examine the contents (not just the scores) of the credit reports from all 3 bureaus.

Even if the information is more or less the same between EQ and TU, there can still be a large difference in scores. In my case, my EQ and TU scores are 36 points apart. So if someone is right around 640 with one score, it doesn't necessarily mean that the other scores are going to be similar.

Re: Trying to raise my score with a 120-day late account

Anonymous — Fri, 28 Jan 2011 06:44:41 GMT

Hey BeamMEup,

I laid out all my info in the mortgage forums:

http://ficoforums.myfico.com/t5/Mortgage-Loans/Will-I-be-Pre-Approved-after-I-get-past-600-on-EQ-FHA-First-Time/m-p/830034

Nobody has given any feedback, but we will wait and see. Thanks for all the help.