topic Re: NEED ADVISE ASAP in Rebuilding Your Credit

NEED ADVISE ASAP

Anonymous — Thu, 01 Apr 2021 18:40:31 GMT

I was approved for USDA loan last year, built house, they got an updated credit report in January and somehow I lost 30 points....absolutely nothing changed. I need 8 points on my middle score (equifax). I went through credit and found errors. I got two collections removed from Equifax which leaves me with 1 paid collection and 2 very old unpaid collections. Got another removed on Transunion, a very recent one that was not accurate, but the agency did not notify experian, but not worried about that as it is my highest score anyway. Lender kept saying just leave stuff alone and it will get 8 points....nothing has moved. I asked him in January if I should get a credit card as I have NONE. On all of my reports one of the main things it says is hurting me is no credit card. My payment history is 100% perfect. Lender said no dont get new credit it will ding you more. I listened to him, but now I'm thinking it was stupid and I should immediately try to get something, maybe even something like open sky that doesn't check credit. Need to know if anyone thinks this will help me get 8 points or if it will kill me more. House is now done and builder is not going to wait forever. Lender said if we had months to deal with it he would say yes but we dont........of course we did back in January when the guy said don't do it!!! Just need advice. I feel like nothing is going to change if I don't do something.

Re: NEED ADVISE ASAP

OmarGB9 — Thu, 01 Apr 2021 18:33:13 GMT

No he was right. Opening ANY new accounts when going for a mortgage is bad not so much because of the inquiry, but because when the new account reports, it'll really hurt your mortgage scores. Mortgage scores are VERY sensitive to new accounts. Getting a CC would've been something you should have done at least a year in advance of your mortgage app.

Are the 2 unpaid COs updating monthly? If so, then paying one or both off (if feasible) should get you those 8 points, as charge offs are counted as maxed accounts and hurt your utilization, which in turn affects scores.

Re: NEED ADVISE ASAP

Anonymous — Thu, 01 Apr 2021 18:39:34 GMT

Sorry those aren't charge offs...i meant the co as collections, sorry wrong abbreviation probably. So even if i did open sky that doesn't do a credit pull? This is just horrible. There has to be something I can do. The two collections on equifax are from 2016 and are not updating.

Re: NEED ADVISE ASAP

OmarGB9 — Thu, 01 Apr 2021 19:04:42 GMT

Yes, CO is charge off. CA is usually used for collections.

https://ficoforums.myfico.com/t5/User-Guidelines-General/Common-Abbreviations/m-p/88458?search-action-id=212030352590&search-result-uid=88458

Anyway, yes, opening up a new CC now would hurt more than help. Again, it's not the hard pull that would hurt, it's the new account showing up on your credit report. Mortgage scores would be dinged by that and the ding would stay for about a year.

Honestly this is tough. I'm not sure there is a whole lot to be done. Who are the collection agencies for the 2 unpaid ones?

Re: NEED ADVISE ASAP

Anonymous — Thu, 01 Apr 2021 19:16:18 GMT

Keybridge. I really thought that removing all that would have some kind of impact. For Equifax...there were 5 total...i removed two of them and paid one.

Re: NEED ADVISE ASAP

Pikaboo-icu — Thu, 01 Apr 2021 19:54:00 GMT

@Anonymous wrote:
Keybridge. I really thought that removing all that would have some kind of impact. For Equifax...there were 5 total...i removed two of them and paid one.

I just looked them up and they do medical debt. Is this medical collections?

There are members here that can help with advice on medical collections BUT their entire site is all about how they "care and want to help you resolve this". To "call them, they have options".. Have you asked them if they do "pay for delete"? Have you tried to settle for less?

Their site makes it appear they are willing to work with the clients..

I wish you good luck with this!!!

Re: NEED ADVISE ASAP

Anonymous — Thu, 01 Apr 2021 19:56:34 GMT

I had 3 with them and paid one...when I did I asked if they would remove and was told there was no way.

Re: NEED ADVISE ASAP

OmarGB9 — Thu, 01 Apr 2021 20:01:14 GMT

@Anonymous wrote:
Keybridge. I really thought that removing all that would have some kind of impact. For Equifax...there were 5 total...i removed two of them and paid one.

Unfortunately with collections, it's all or nothing. Getting one or two removed when you have 5 showing, and then only paying off one of the remaining 3 or 4 doesn't really yield much in the way of points. With collections they have to all be deleted to see major score boosts.

But if these are medical debts, then there is hope! The following post gives you some steps to try:

@gdale6 wrote:
For unpaid medical debt that is reporting on your CR:

1. Call the OC and see if you qualify for Charity Care
2. If not then ask that they recall the collection in exchange for full payment
3. Send the reporting CA a PFD offer
4. Google the HIPAA Process and contact its creator for help

Re: NEED ADVISE ASAP

Pikaboo-icu — Thu, 01 Apr 2021 20:02:51 GMT

@Anonymous wrote:
I had 3 with them and paid one...when I did I asked if they would remove and was told there was no way.

Is there anyway you can pay them? Even if you settle for a lesser amount?

I believe paid collections are less harmful to your score.

I think it's @gdale6 that has excellent advice & macros for medical debt..

Re: NEED ADVISE ASAP

Anonymous — Thu, 01 Apr 2021 20:32:18 GMT

These are two very small collections. I can pay them, but they are old. Last report date was this month. Can someone confirm 100% that fico mortgage scores will improve if these are paid? If I do pay them I will have 3 paid collections only on Equifax.

Re: NEED ADVISE ASAP

dragontears — Thu, 01 Apr 2021 23:38:11 GMT

@Pikaboo-icu wrote:
@Anonymous wrote:
I had 3 with them and paid one...when I did I asked if they would remove and was told there was no way.
Is there anyway you can pay them? Even if you settle for a lesser amount?
I believe paid collections are less harmful to your score.

I think it's @gdale6 that has excellent advice & macros for medical debt..

This is incorrect in reference to the model being discussed, paid vs unpaid collection accounts is the same on mortgage scores and FICO 8, with FICO 9 paid collections results in score increase.

Another fun fact about collections and how they are treated differently by the scoring algorithms. Small "nuisance" collections (<$100) are ignored by FICO 8 but are fully counted by older models such as mortgage scores

Re: NEED ADVISE ASAP

Pikaboo-icu — Thu, 01 Apr 2021 23:48:37 GMT

@dragontears wrote:
@Pikaboo-icu wrote:
@Anonymous wrote:
I had 3 with them and paid one...when I did I asked if they would remove and was told there was no way.
Is there anyway you can pay them? Even if you settle for a lesser amount?
I believe paid collections are less harmful to your score.

I think it's @gdale6 that has excellent advice & macros for medical debt..

This is incorrect in reference to the model being discussed, paid vs unpaid collection accounts is the same on mortgage scores and FICO 8, with FICO 9 paid collections results in score increase.
Another fun fact about collections and how they are treated differently by the scoring algorithms. Small "nuisance" collections (<$100) are ignored by FICO 8 but are fully counted by older models such as mortgage scores

Thanks perhaps I'm confusing it with CC balances.. I swear I read that mortgage scores reacted to zero balances, someplace..

Who knows, maybe I dreamt it lol. I did my mortgage 20 yrs ago so not up to date on the score factors.

CHEERS

Re: NEED ADVISE ASAP

dragontears — Thu, 01 Apr 2021 23:56:17 GMT

@Pikaboo-icu wrote:
@dragontears wrote:
@Pikaboo-icu wrote:
@Anonymous wrote:
I had 3 with them and paid one...when I did I asked if they would remove and was told there was no way.
Is there anyway you can pay them? Even if you settle for a lesser amount?
I believe paid collections are less harmful to your score.

I think it's @gdale6 that has excellent advice & macros for medical debt..

This is incorrect in reference to the model being discussed, paid vs unpaid collection accounts is the same on mortgage scores and FICO 8, with FICO 9 paid collections results in score increase.
Another fun fact about collections and how they are treated differently by the scoring algorithms. Small "nuisance" collections (<$100) are ignored by FICO 8 but are fully counted by older models such as mortgage scores
Thanks perhaps I'm confusing it with CC balances.. I swear I read that mortgage scores reacted to zero balances, someplace..
Who knows, maybe I dreamt it lol. I did my mortgage 20 yrs ago so not up to date on the score factors.

CHEERS

Absolutely on the CC balances, in general mortgage scores react positively to paying CC balances $0 as long as you don't go to AZ.

Another fun fact about difference in models, FICO 8/9 don't include charge cards in utilization, while mortgage scores do (uses the historical "high balance" as the credit limit)