PenFed Recon Advise

[Anonymous]

I have patiently waited, planned and finally my moment arrived - I applied to PenFed as I desperately need to refi my auto loan from its dreadful 13%.  I joined online and called to complete the loan app.  It came back declined for past/present deliquent accounts.

Positives - I have the BoA 99/500 which I unsecured and recevied a CLI to 1K with 0 balance, an Orchard with $320 limit 0 balance reporting, Cap1 with 1.1K limit and $33 balance and Macys 500 limit and 0 balance.  My current auto loan is current/never late and all other closed accounts reporting are good history.

Negatives - I have 2 student loans that defaulted in 07, but have been rehabbed and the new tradelines are showing pays as agreed, but the 2 defaulted lines remain.  I have another 2 student loans that were seriously delinquent until 06/2008 but have been deferred therefore showing positive since 07/2008.  Finally, I have a previous auto loan that has four lates from 2005 and earlier - no GW success to date on that.

My EQ is 671 and TU is 651 (FICOs), which are up from EQ 629, TU 601, EX 581 in Feb. 2009.  Average age of accounts if 4 years.

Also, I am self-employed. 

PenFed has given me the recon fax; however, I wanted any advise on how to recon - should I just play up the rehabbed loan status?  On the other hand, BoA has a 4.92% on their auto refi that I could probably take advantage of if PenFed sticks to their guns.

TIA for your opinions

[mt2va]

I'm sure others will chime in that have more advice, but just from hanging out on these boards the comments I've seen about Penfed are that they are VERY conservative in their lending.  Most of the folks having success with them have scores in the upper 700s to the 800s. 

IMHO I think you would have better luck with another CU that isn't quite so strict.  While you have positive TL currently they are clearly from starter cards/less than prime lenders. 

[YoungEntrepeneur]

As mentioned above, PenFed is very strict. I don't know how they are with auto refi's but when I applied for their Visa Cashback card, they denied me for "pyramiding debt" which seems to be a common denial reason they keep using.

You should join Alliant Credit Union since they are less conservative than PenFed and will give you some pre-approval offers when you join online. Many people have reported that they've received auto loan offers at good rates when they joined online. If that doesn't workout, then I would look into joining a local CU and see if they can help you out. I wouldn't go with BoA right now because they're struggling and there's a good chance that they will deny you for the refi as would other banks. CU's are the place to be now and you should explore your options.

[Anonymous]

Yes, the pyramiding debt thing...I have read much about that one as well and made sure that my inquiries in the past 6 months were 0, except the unexpected one from BoA when they unsecured the 99/500 and that all of my balances reported 0 except for 1 account, thus an overall 1% utilization. 

Their widely known strictness is the cause my hesitation with submitting the recon - might not even be worth the energy of haggling over words if they won't budge.  My local CU, to which I am a member, has 5.75% refi, another good one in comparison to my current 13% but I guess I shall check into CCCU, Justice, Alliance and Nasa...any other ones up for suggestion?

Thanks guys - though I am proud of my improvements, I may have reached too high, too early on this one  

[Anonymous]

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@Anonymous wrote:

Negatives - I have 2 student loans that defaulted in 07, but have been rehabbed and the new tradelines are showing pays as agreed, but the 2 defaulted lines remain. 

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I am not sure about how to reconn, however wanted to ask you about the above. When you are approved for a student loan "rehab", the negative history is to be removed and replaced with postive payment history after you complete the rehab timeframe. Are your student loans directly from the US Dept or Ed (Direct Loans) or with another institution or bank? Mine are Direct Loans and my credit history was updated to pays on time after I completed one year of on-time payments. After that, i was able to go into deferrment.

[smallfry]

Self employed with recent lates will be a tough one to get past. 

[Anonymous]

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@Anonymous wrote:

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Also, I am self-employed. 

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Cut your losses and move on. With the SE status and the borderline scores for them, I'd say you're looking at a hassle. I too am self-employed and even witha  740+ EQ at the time, perfect/spotless payment history and no new accounts at the time, I finally was awarded a whopping $1000k CC after a week of faxing over more documentation than I needed to obtain my mortgage last month.  They wouldn't ever let me get past the CSR that answer the phones and the only way was to fax in what they asked and wait for them to update the status on their website which would only result in them asking for something else.

This is the only card I have that I regret. It is my lowest tradeline, matched by a Target RedCard and superceded by a freakin' Kohl's card.

To add insult to injury they have suspended my account now on 2 occassions for supicisou activity which has only been at grocery stores or gas stations.  Hmm, what's suspicious about using a 5% back on gas and 2% back on groceries card at the gas/grocery store?

When my recent tax return reflected a substantial increase in my income I requested that we update my income so that I may be eligible for CLI, etc. and the girl told me that in order to update my information I had to apply for something else.

I also asked her to update my new address since I just bought a house. When I later logged into my account she had my entire address all screwed up and entere Rhode Island as "Road Island". For an instititution that tries to maintain this level of prestige and makes it so hard to get in, I'd expect customer service reps that can atleast spell the names of our States correctly.

I've tried to give them the benefit of the doubt after my application ordeal, but they have continuously let me down.

The CSR from the app period told me they do not think highly of the self-employed. I did see someone else a while back that reported no issues with it, but they put me through the ringer and back for a $1000 CL. 

Message Edited by UpUpUp on 05-22-2009 02:10 PM

[mt2va]

Try NFCU if you are eligible for membership.

[Anonymous]

Thanks for your replies.

UpUpUp thanks for contributing as I recall that you have SE status also and had you in mind amongst a few others when I posted for advise.

Purple haze - After the loans defaulted ASCI was listed on my reports in addition for the duration of the rehab.  I completed the rehab in April and currently Nelnet has my loans but they are slated to be bought and consolidated by Direct Loans.  ACSI'stradelines were not immediately removed so I disputed them for a more swift removal.  Now the original defaulted loans yet remain on my report, as claim filed with guarantor/assigned to government or something.  They show 0 balance, but my understanding is that they will be a permanent scar of my former irresponsibility until 2015.  Furthermore, once Direct Loan has bought them, I will end up yet another two tradelines, though the Nelnet will reflect positive status for another 10 years.  Are you suggesting that the Direct Loan tradelines will replace the original defaulted loan tradeline?

mt2va - NFCU is navy federal right?  I'm not military affiliated so that would be a no go for me.

Off to research a few other cu's...thanks all!

edit: to clarify SL portion

Message Edited by WishIKnewThen on 05-22-2009 04:45 PM

[Lyythine]

I have been a PenFed member for almost 3 years, within the past year I received a credit card from them, scores all above 750 now, no baddies on any reports.  I have 16 credit cards, all over 5k limit, PenFed, who has 5 accounts of mine, and an inheritance from my grandmother that pays to me, gave me an awesome limit of 2.5k.  

So, long story short, conservative does not even come close to defining them as an institution.  I would suggest NFCU or Bank of America.  Im currently in love with NFCU as i have stated before, and Ive never had a problem with BofA when it comes to long-term loans (student/auto)  rates are pretty good and they are starting to lend again, which is nice.  good luck!!