topic Re: Freaking Out!! in Mortgage Loans

Freaking Out!!

Anonymous — Thu, 11 Sep 2008 18:41:50 GMT

Okay, I am in the process of getting my mortgage loan approved. My file is in with the underwriter, has been there for about a week. I have talked to both the loan processor and loan officer and they both say all is going well. This is why I am freakin... since the process began, I have made charges on my credit card. I am ashamed to say but ALOT. I spoke with my loan officer about it and he said that he will not pull my credit anymore, but he did not know if the underwriter will. I plan on paying them off before the end of the month (September). Am I screwed? Please advise.

Re: Freaking Out!!

Lel — Thu, 11 Sep 2008 19:25:31 GMT

If your statement hasn't closed yet, then the CCCs should not be reporting your new balance. If you think the approval is going to be drawn out, then you should consider paying down your balances before your statement actually closes. The CCCs will report the balance due at the end of the billing cycle.

Re: Freaking Out!!

Anonymous — Thu, 11 Sep 2008 20:08:11 GMT

Lel is right. CCC do not report instantaneously. Your balance is submitted typically once a month, and, in the most cases, reflects the balance on your monthly statement.

Re: Freaking Out!!

Anonymous — Thu, 11 Sep 2008 22:25:16 GMT

Thanks for the advice. I called the credit card company, the report to the bureaus on the 27th. I am suppose to close on the 10/06. I should be good right?

Re: Freaking Out!!

Lel — Thu, 11 Sep 2008 23:45:13 GMT

What is your overall utilization percentage? If you have a ton of available revolving credit, then your scores might be less sensitive to a big balance increase, though the balance increase itself might drop your scores, even if your overall utilization is still low. Also, what is your current FICO score? If your score is high, then even a drop in score wouldn't adversely affect your ability to get approved.

But if you want to play it safe, just pay off/pay down your balance before the statement closes.

Re: Freaking Out!!

Anonymous — Fri, 12 Sep 2008 00:28:27 GMT

My FICOs are EQ619 EX613 TU598

Re: Freaking Out!!

Lel — Fri, 12 Sep 2008 18:16:31 GMT

Yeah, in my opinion you should definitely pay down before the statement closes. I don't know that your scores would be particularly sensitive to a dramatic balance increase, but if I were in your shoes I wouldn't take the risk. Just to be sure, you know what this means to pay before the statement closes, right?

Re: Freaking Out!!

Anonymous — Fri, 12 Sep 2008 19:14:45 GMT

I know exactly what you are talking about. I will definitely pay off the balance at least to what it was when the initially pulled my credit. When you say pay before the statement close, you are saying pay on or before the payment due date--right?

Re: Freaking Out!!

Lel — Fri, 12 Sep 2008 23:36:55 GMT

@Anonymous wrote:
When you say pay before the statement close, you are saying pay on or before the payment due date--right?

NO!!!! The statement closing date is when the credit card company stops adding charges to your statement. This date might be called the "statement date", and is usually the day they print and mail your billing statement. You need to pay down your balance before this date, otherwise the high balance will post and will be reported to the credit reporting agencies.

The payment due date follows about 2-3 weeks after the statement closing date. Take a look at your most recent credit card statement and you'll understand the difference between the two dates.

Pay before the statement closes!!!!!

Re: Freaking Out!!

Anonymous — Sat, 13 Sep 2008 00:38:29 GMT

I was actually playing it safe by paying it on its due date which is the 22nd. According to my last statment reads: Statement for 07/29 to 08/27/08.

Re: Freaking Out!!

Lel — Sat, 13 Sep 2008 06:43:27 GMT

@Anonymous wrote:
I was actually playing it safe by paying it on its due date which is the 22nd. According to my last statment reads: Statement for 07/29 to 08/27/08.

So that means that your statement closing date was 8/27. Are your large purchases on that statement, or were they made after 8/27? If they are on your 8/27 statement, then that balance from that statement probably has already been reported to the CRAs.

If your large purchases were made after 8/27, then the high balance probably has not been reported to the CRAs. But if you don't pay it down before the next closing date (which should also be around 9/27), then the high balance will report shortly after the statement closes. So you would want to make a preemptive payment to your account before 9/27. When the statement closes, it will only show a low balance, which would be favorable to your credit scores.

BTW, some people here have noticed score drops when all their credit cards report a zero balance. It is better to have at least one credit card report a balance, as long as it's not a really high balance and as long as you pay it on time.