topic Building from nothing in Rebuilding Your Credit

Building from nothing

Shellie — Mon, 20 Aug 2018 20:03:37 GMT

Hubs didn't exist prior to this year...

He had no credit. I couldn't even pull a report for him. He had never had any credit cards, auto or home loans etc. I was able to get him a secured card from Discover in April. He has been managing it perfectly. A collection got put on his report without us knowing that a bill was even due but it has since been paid (Verizon-working on a goodwill deletion). Right now his scores are 613 TU thru his Discover card, and 559/559 TU/EQ thru Credit Karma. It was 639 thru a bank pull for a mortgage pre-quail last month.

Any suggestions on cards to try to get him one more to help? I have tried a couple of the "check if you're pre-qualified without hurting your credit" cards and he has no luck. I have tried a couple of store cards for pop-ups but nothing pops up. I have not tried any of the cards like "credit one" or any of the really sub-prime cards.

We will be re-applying for the mortgage next year. We are waiting 6 months for his score to grow and more time to save money.

Any suggestions?

Re: Building from nothing

xaximus — Mon, 20 Aug 2018 20:09:34 GMT

I would add another rebuilding card - possibly try Cap1 as well. Also, add an SSL. Without any loans, his credit mix is only showing CC lenders.

Re: Building from nothing

Shellie — Mon, 20 Aug 2018 20:11:36 GMT

If he went and got a small loan from the bank would it hinder our mortgage efforts?

I can't remember all the ins and outs of new credit before applying for a mortgage...

Re: Building from nothing

Anonymous — Mon, 20 Aug 2018 21:04:11 GMT

A SSL loan from a local CU would generally be $500-1000 with a monthly payment of $25 or so. That shouldn't put much of a dent in your DTI, especially since he obviously doesn't have any other outstanding debt. So no worries. You just don't want to add new accounts in the final 6 months before apping for a mortgage loan.

Other credit card options are various secured cards, available at US Bank, Wells Fargo or some online providers. Most of them will do a hard pull of your credit, which would put a slight ding (about 5 points) in your score. But adding another card (or two) would probably raise your score about 20 points once they start reporting.

It sounds like he might really benefit from being added as an authorized user to someone else's card with a long clean history. See if a relative of his or yours might be able to do that. I don't think it would help a whole lot in the mortgage process but it could raise his score quickly for now.

Another option for adding a tradeline is to get your rent reported (assuming you have a good history there). There are a few companies that will verify and report your rent, sometimes going back a couple years.

Re: Building from nothing

xaximus — Tue, 21 Aug 2018 13:31:27 GMT

I believe being an AU won't help in the mortgage process. (From what I've heard). I would recommend getting a self lender loan and adding another 1-2 cards in the mix. That would definitely help.

Re: Building from nothing

Shellie — Tue, 21 Aug 2018 13:43:20 GMT

We have a perfect rent history BUT we rented from a 80-90 yo woman and paid cash every month. So I don't think that would help. Unless a letter from her stating we paid on time would hold weight.

Will more secured cards help? I can't even get him qualified for a Capital One card or a store card. I will be calling our C/U today to see about the secured loan.