topic Re: This is so frustrating. in General Credit Topics

This is so frustrating.

Anonymous — Wed, 30 Dec 2009 18:41:46 GMT

I got a 664 score here from MyFico. After reading the analysis of my credit report, it says that while it's not a great score, it's considered a good score. I applied for a $30k auto loan recently through a credit union, only to be denied because of my FICO score and "excessive obligation of income." I make about $45K a year. I understand that applying for that amount was too much. I called up the credit union and asked if I was to lower the amount, would I then be qualified. They told me it's unlikely since I don't have much credit history. You can read the first post from another thread I made which details my story and why I have kept low key here.

So I thought, with this credit union, I can establish some kind of credit history and prove myself that I can be just as responsible. I applied for a $500 Credit card with them, only to be denied once more. How can I establish any kind of credit history if I can't get any credit? According to myFico.com 664 isn't a bad score, yet there are some with lower scores being approved, most from their own credit unions. I have a great rating since I have not been looking for any credit for the past 3 years. I am wondering what was the point of joining a credit union.

My only obligations are food, rent, utilities, and a student loan. Rent, student loan, and utilities are all paid on time. I've paid my student loan on time for the past 4 years, yet that holds no weight of any kind of credit history. I noticed that they haven't updated since back in October. I asked them how come they don't update monthly like most. The Student loan rep said the only time they will update to the credit bureaus is when I go 60 days delinquent.

Can anyone share some advise on this? This is such a frustrating experience.

Re: This is so frustrating.

DI — Wed, 30 Dec 2009 19:07:59 GMT

To see a quick and significant increase in your FICO scores, you should become an AU on someone's credit card with a good credit history.

Also, a $30K car loan with a $45K salary wouldn't have been a good decision. That's 66% of your income(not good). Before applying for a big ticket item, it would be best to have your scores above 750's to get the lowest possible rates.

CU's doesn't lower its standard just as well as banks doesn't lower its standards. Joining a CU is only an alternative than using a traditional bank which may come with lower rates.

Students loans that are with Sallie Mae are updated quarterly. FYI...if your student loans are all in good standing, your FICO scores have already benefited from them. Having revolving credit(credit cards) reporting and paying in full is what going to maximize your FICO scores further.

You have two good things going for yourself.

1. No Credit Card Debt

2. No Car Loan.

You should feel fortunate. I would keep it that way.

Good luck! D.I.

Message Edited by DI on 12-30-2009 01:07 PM

Re: This is so frustrating.

Lel — Wed, 30 Dec 2009 19:18:25 GMT

I'm sorry to hear about your ongoing troubles.

Looking over your other thread, the discussion regarding your credit history has been nonspecific - talking mostly about your credit score, but not the factors that underlie that score. That is, you haven't described what actually appears in your credit report.

You mentioned that you used to have a handful of cards that went into collections. Do those derogatory accounts still appear on your credit report? You state that you have paid your student loan on time for the past 4 years - were there late payments prior to that? Do you have any other accounts (e.g. paid-off car loans) that are in good standing?

I mentioned in your other thread that there's more to an auto loan approval than a credit score. Similarly, there is more to a credit card approval than a credit score. If your credit report contains too much derogatory information, then you can be declined, even with a respectable credit score like yours.

A secured card may be a necessary step in your ongoing recovery from credit troubles.

Re: This is so frustrating.

Anonymous — Wed, 30 Dec 2009 21:38:20 GMT

@Lel wrote:
I'm sorry to hear about your ongoing troubles.

Looking over your other thread, the discussion regarding your credit history has been nonspecific - talking mostly about your credit score, but not the factors that underlie that score. That is, you haven't described what actually appears in your credit report.

You mentioned that you used to have a handful of cards that went into collections. Do those derogatory accounts still appear on your credit report? You state that you have paid your student loan on time for the past 4 years - were there late payments prior to that? Do you have any other accounts (e.g. paid-off car loans) that are in good standing?

I mentioned in your other thread that there's more to an auto loan approval than a credit score. Similarly, there is more to a credit card approval than a credit score. If your credit report contains too much derogatory information, then you can be declined, even with a respectable credit score like yours.

A secured card may be a necessary step in your ongoing recovery from credit troubles.

Thank you for responding.

I had one credit card that went into collections, and ultimately, a judgement was filed and is the biggest stain in my report. I however satisfied the judgement. All other derogatory accounts I had does not appear on any report. They were removed. My student loans was consolidated from several loans. When they were seperate, I did have trouble paying them off but since they were consolidated, I have paid them off each time.The credit union pulled my Eq file and that is the most up to date report (no inaccurate info). I never had a car loan before but I did have a Sallie Mae loan paid off. It doesn't appear on my reports.

If I decide to use a secured card will they report it as a secured account?

Re: This is so frustrating.

Jazzzy — Wed, 30 Dec 2009 23:25:28 GMT

@Anonymous wrote:

Thank you for responding.

I had one credit card that went into collections, and ultimately, a judgement was filed and is the biggest stain in my report. I however satisfied the judgement. All other derogatory accounts I had does not appear on any report. They were removed. My student loans was consolidated from several loans. When they were seperate, I did have trouble paying them off but since they were consolidated, I have paid them off each time.The credit union pulled my Eq file and that is the most up to date report (no inaccurate info). I never had a car loan before but I did have a Sallie Mae loan paid off. It doesn't appear on my reports.

If I decide to use a secured card will they report it as a secured account?

Hi. I understand your frustration. Patience is often the toughest part of building or rebuilding credit. How old is your judgment? As it ages, it should be less of a factor.

Have you read much on the Credit Card forum? Secured cards are discussed often there, and there are some real experts who can help you. I would urge you to ask the question about how these cards report in the Credit Card forum.

Re: This is so frustrating.

laz98 — Thu, 31 Dec 2009 01:43:35 GMT

DI wrote:

Students loans that are with Sallie Mae are updated quarterly.

Is this your experience? Mine update monthly.

Re: This is so frustrating.

RobertEG — Thu, 31 Dec 2009 03:27:15 GMT

I would speculate that your credit is being dragged down primarily due to the collection and judgment, which are both major derogs.

Any collection usually has prior reported deliquencies by the original creditor (OC), which were reported monthly before the collection was entered. They become a major derog, in and of themselves, when they reach 60+ days delinquenct, and remain in your CR for 7 years from each of their individual dates.

If the OC then places the debt for collection, that adds an additional collection major derog to your CR. The CA remains for 7 1/2 years from the DOFD on the OC account.

And, if the collection is then brought before the court, and a judgment is secured, that adds an additional major derog to your CR Judgments remain for 7 years from their date of entry.

So it appears that you have a compilation of major derogs.

Creditors dont lend based solely on a FICO score. FICO does not even consider income, for example, but lendors do.

I would do everthing in my power to try to get that collection/judgment deleted. If you have now satisfied that debt, the recourse is to ask for a good-will (GW) deletion, but that is hard to obtain.

Best of luck!

Re: This is so frustrating.

Anonymous — Thu, 31 Dec 2009 15:13:42 GMT

@LynetteM wrote:
@Anonymous wrote:

Thank you for responding.

I had one credit card that went into collections, and ultimately, a judgement was filed and is the biggest stain in my report. I however satisfied the judgement. All other derogatory accounts I had does not appear on any report. They were removed. My student loans was consolidated from several loans. When they were seperate, I did have trouble paying them off but since they were consolidated, I have paid them off each time.The credit union pulled my Eq file and that is the most up to date report (no inaccurate info). I never had a car loan before but I did have a Sallie Mae loan paid off. It doesn't appear on my reports.

If I decide to use a secured card will they report it as a secured account?
Hi. I understand your frustration. Patience is often the toughest part of building or rebuilding credit. How old is your judgment? As it ages, it should be less of a factor.

Have you read much on the Credit Card forum? Secured cards are discussed often there, and there are some real experts who can help you. I would urge you to ask the question about how these cards report in the Credit Card forum.

I might have read a few posts on credit cards. My judgement was filed in 2005. It was paid off the end of that year. I have been waiting patiently and to finally seek credit, and get turned away, I feel like an outcast or something.

Re: This is so frustrating.

Anonymous — Thu, 31 Dec 2009 15:16:06 GMT

@RobertEG wrote:
I would speculate that your credit is being dragged down primarily due to the collection and judgment, which are both major derogs.

Any collection usually has prior reported deliquencies by the original creditor (OC), which were reported monthly before the collection was entered. They become a major derog, in and of themselves, when they reach 60+ days delinquenct, and remain in your CR for 7 years from each of their individual dates.
If the OC then places the debt for collection, that adds an additional collection major derog to your CR. The CA remains for 7 1/2 years from the DOFD on the OC account.
And, if the collection is then brought before the court, and a judgment is secured, that adds an additional major derog to your CR Judgments remain for 7 years from their date of entry.
So it appears that you have a compilation of major derogs.
Creditors dont lend based solely on a FICO score. FICO does not even consider income, for example, but lendors do.
I would do everthing in my power to try to get that collection/judgment deleted. If you have now satisfied that debt, the recourse is to ask for a good-will (GW) deletion, but that is hard to obtain.
Best of luck!

So a good will deletion request is the best way to remove that judgement? Where can I find more info about that? Thanks for your help.

Re: This is so frustrating.

Anonymous — Thu, 31 Dec 2009 15:18:43 GMT

@DI wrote:
To see a quick and significant increase in your FICO scores, you should become an AU on someone's credit card with a good credit history.

Also, a $30K car loan with a $45K salary wouldn't have been a good decision. That's 66% of your income(not good). Before applying for a big ticket item, it would be best to have your scores above 750's to get the lowest possible rates.

CU's doesn't lower its standard just as well as banks doesn't lower its standards. Joining a CU is only an alternative than using a traditional bank which may come with lower rates.

Students loans that are with Sallie Mae are updated quarterly. FYI...if your student loans are all in good standing, your FICO scores have already benefited from them. Having revolving credit(credit cards) reporting and paying in full is what going to maximize your FICO scores further.

You have two good things going for yourself.

1. No Credit Card Debt
2. No Car Loan.

You should feel fortunate. I would keep it that way.

Good luck! D.I.
Message Edited by DI on 12-30-2009 01:07 PM

Thanks D.I. I do feel fortunate somewhat but if I want to improve my score, I need a revolving account and prove that I can make the payments in timely matter. I understand the $30K loan with my $45K salary but for a $500 credit card for the same reasons of being denied?!! That's a bit odd.

Re: This is so frustrating.

Anonymous — Thu, 31 Dec 2009 15:34:26 GMT

Oh and being an AU of another account is not an option for me. But thanks to all that suggested.

Re: This is so frustrating.

Jazzzy — Thu, 31 Dec 2009 18:16:51 GMT

MrNoCreditMan wrote:

So a good will deletion request is the best way to remove that judgement? Where can I find more info about that? Thanks for your help.

You can find more information on the Rebuilding Your Credit forum.

Re: This is so frustrating.

Anonymous — Mon, 04 Jan 2010 16:32:42 GMT

UPDATE!!!!

Happy New year to all of you!

Wow, I log on to find that my Eq score went up from 664 to 739!!! Had I waited sooner, maybe I had a better chance to get an approval on the CC app. I am feeling pretty good right now. Now I just need to get my scores up with the other CRAs. It appears that the public record was removed and my student loan now holds weight to be considered a worthy source of credit history!

If I go to the credit union to let them know my score went up, will that matter now?

Message Edited by MrNoCreditMan on 01-04-2010 08:32 AM

Re: This is so frustrating.

Jazzzy — Thu, 07 Jan 2010 19:14:48 GMT

@Anonymous wrote:
UPDATE!!!!

Happy New year to all of you!

Wow, I log on to find that my Eq score went up from 664 to 739!!! Had I waited sooner, maybe I had a better chance to get an approval on the CC app. I am feeling pretty good right now. Now I just need to get my scores up with the other CRAs. It appears that the public record was removed and my student loan now holds weight to be considered a worthy source of credit history!

If I go to the credit union to let them know my score went up, will that matter now?

Congratulations!!!

You never know if it could help to go back to the CU. Some places have restrictions on how long you have to wait between applications. But, CUs often set their own rules.

Take a copy of your new report and score and try to sit down with someone and show them the improvements. That won't cost you anything. Tell them you're not wanting another hard inquiry unless they feel you have a good shot.

Re: This is so frustrating.

Anonymous — Thu, 07 Jan 2010 19:35:06 GMT

@LynetteM wrote:
@Anonymous wrote:
UPDATE!!!!

Happy New year to all of you!

Wow, I log on to find that my Eq score went up from 664 to 739!!! Had I waited sooner, maybe I had a better chance to get an approval on the CC app. I am feeling pretty good right now. Now I just need to get my scores up with the other CRAs. It appears that the public record was removed and my student loan now holds weight to be considered a worthy source of credit history!

If I go to the credit union to let them know my score went up, will that matter now?
Congratulations!!!

You never know if it could help to go back to the CU. Some places have restrictions on how long you have to wait between applications. But, CUs often set their own rules.

Take a copy of your new report and score and try to sit down with someone and show them the improvements. That won't cost you anything. Tell them you're not wanting another hard inquiry unless they feel you have a good shot.

Update: Would you believe it, I was approved for a loan with my CU!!! I hate to sound all mushy but it made me feel so good to hear the officer say "the loan was approved!" I never thought I'd hear those words. So what I was told is that the loan would cover just 85% of whatever the lowest amount between the price asked and book value of the car. So I have to put a down payment on a car. This is for a used auto, but I got the hint that I can actually look for a new car. Is that true? Also, if I wanted to put little to no down payment (most likely a lease option), would the financing through the dealers be the best way to go? Thank you Lynette! You and many others have been very helpful.

Re: This is so frustrating.

Jazzzy — Thu, 07 Jan 2010 23:16:36 GMT

@Anonymous wrote:

Update: Would you believe it, I was approved for a loan with my CU!!! I hate to sound all mushy but it made me feel so good to hear the officer say "the loan was approved!" I never thought I'd hear those words. So what I was told is that the loan would cover just 85% of whatever the lowest amount between the price asked and book value of the car. So I have to put a down payment on a car. This is for a used auto, but I got the hint that I can actually look for a new car. Is that true? Also, if I wanted to put little to no down payment (most likely a lease option), would the financing through the dealers be the best way to go? Thank you Lynette! You and many others have been very helpful.

Well...now you deserve even a bigger Congratulations!

A couple of things concern me, and were I you, I would give a call to the CU and clarify a couple of things. Do you have an approval amount? Usually, when approved for an auto loan, customers are told that they are approved up to a certain amount. You need to know a price range...so, call them and ask.

Secondly, you need to clarify new vs. used. If the loan is specified for a used auto, it seems that's what you need to buy. Please don't offer on a new vehicle without verifying if this is possible with the CU.

I don't like lease situations, so I am not one to advise on that. From your last question, are you considering NOT using the CU loan and applying through a dealership? What interest rate did the CU quote you?

Give us a few more details on what the CU agreed to loan you and how much they are going to charge (interest rate). It's hard to advise without that info.

Re: This is so frustrating.

Anonymous — Fri, 08 Jan 2010 00:30:26 GMT

@LynetteM wrote:
@Anonymous wrote:

Update: Would you believe it, I was approved for a loan with my CU!!! I hate to sound all mushy but it made me feel so good to hear the officer say "the loan was approved!" I never thought I'd hear those words. So what I was told is that the loan would cover just 85% of whatever the lowest amount between the price asked and book value of the car. So I have to put a down payment on a car. This is for a used auto, but I got the hint that I can actually look for a new car. Is that true? Also, if I wanted to put little to no down payment (most likely a lease option), would the financing through the dealers be the best way to go? Thank you Lynette! You and many others have been very helpful.
Well...now you deserve even a bigger Congratulations!

A couple of things concern me, and were I you, I would give a call to the CU and clarify a couple of things. Do you have an approval amount? Usually, when approved for an auto loan, customers are told that they are approved up to a certain amount. You need to know a price range...so, call them and ask.

Secondly, you need to clarify new vs. used. If the loan is specified for a used auto, it seems that's what you need to buy. Please don't offer on a new vehicle without verifying if this is possible with the CU.

I don't like lease situations, so I am not one to advise on that. From your last question, are you considering NOT using the CU loan and applying through a dealership? What interest rate did the CU quote you?

Give us a few more details on what the CU agreed to loan you and how much they are going to charge (interest rate). It's hard to advise without that info.

Sure thing Lynette.

I like the flexibility of the lease in which I can change up cars every few years, and the payments are lower. But I do know that buying a car is the way to go where you'll have full ownership after the final payment. I'm still thinking about the lease vs buy.

The loan officer said I qualify for 5.75% APR, with an automatic 0.125% off since I applied through the internet, and a possible 0.125% if I add GAP insurance, and 0.125% off if I choose the payroll deduction for payments. So it's a possible to have a 5.375% APR once I sign on the loan. The amount, although I didn't ask, I originally applied for 20K ( I had asked for 29K the first time). The officer asked me, what kind of cars are you looking at? I gave a couple of car specs to the officer to determine pricing. I don't want to go over 21K, because then I won't be realistic in getting a car. 15% down payment is what I didn't expect. I was thinking maybe 5-8%. So I'm shopping around. And I'm thinking maybe shop around some more since I have a two week window for auto loans? Could I get anything better than 5.375? I'm new at all this, so thanks for bearing with me.

Re: This is so frustrating.

MattH — Fri, 08 Jan 2010 02:24:49 GMT

@Anonymous wrote:

...

I like the flexibility of the lease in which I can change up cars every few years, and the payments are lower. But I do know that buying a car is the way to go where you'll have full ownership after the final payment. I'm still thinking about the lease vs buy.
...

Be very very very very careful about leasing a car, because a lease is a much more complex transaction and therefore is much more challenging to compare. When you buy a car outright you are able to compare deals pretty easily, but no two lease contracts are the same. In your shoes I would buy a late model used car and keep it till it falls apart. I'm still driving a 2000 Camry I got in 2004 even though I could buy a new car tomorrow without borrowing a cent, because my wife and I have other plans for our savings.

Re: This is so frustrating.

DI — Fri, 08 Jan 2010 03:44:26 GMT

@laz98 wrote:
DI wrote:

Students loans that are with Sallie Mae are updated quarterly.

Is this your experience? Mine update monthly.

Yes this is my experience. I get updates every three months. It could be because they are currently in deferment until May 2010.

Re: This is so frustrating.

DI — Fri, 08 Jan 2010 03:46:33 GMT

@Anonymous wrote:
UPDATE!!!!

Happy New year to all of you!

Wow, I log on to find that my Eq score went up from 664 to 739!!! Had I waited sooner, maybe I had a better chance to get an approval on the CC app. I am feeling pretty good right now. Now I just need to get my scores up with the other CRAs. It appears that the public record was removed and my student loan now holds weight to be considered a worthy source of credit history!

If I go to the credit union to let them know my score went up, will that matter now?

Message Edited by MrNoCreditMan on 01-04-2010 08:32 AM

Congrats! That's what I'm talking about.Very awesome!! Now you can ask for a recon at the C.U.