Closing on a new home if I can get my middle score to 600

[Anonymous]

I will get a new home with a fabulous mortgage if I can get my middle score up to 600.  (Rate will be 5.875% fixed for 40 years with no prepayment penalty!)  I have to be able to do this quickly because the seller won't wait.

My mortgage loan officer talked about rapid rescore but she can't guarantee the scores will go up and there's even a possibility they might go down.

Transunion is at 618 so we're going to leave those tradelines alone.

Experian - 589.  I just paid off 2 very old collections.  The collections were from 2001 and 2002. I had one late on Target in August and one late last November.  They have upgrade me to a Target VISA but I don't know if that will be considered a new tradeline thereby bringing my scores down. I had  two lates on Macy's last spring.

Equifax - 599  Oh so close to that elusive 600!  The old collections did not show up on Equifax.  Just the Target and Macys mentioned above.

Any advice?  Do you think doing a rapid rescore on the two old collection items will be enough to raise the Experian score to 600+?

What about the Target tradeline.  Do you think a rapid rescore will help or harm?  What about Macy's

Any suggestions will be appreciated. 

[Anonymous]

looks like the rapid rescore is you only option. just thinking analytically you aren't were you need to be and the only options are wait or recore. please wait until others w/more knowlegde chime in though. either way good luck, that is a great loan!

[Anonymous]

I hate to say this but by just paying the CA's the score will very likely go down.

Paying down revolving balances and good willing accuate late payments are the only sure way to get a fico boost.

If you have accts that are slow reporting- this MAY help the score as well. You need to look at the "last reported"

[Takunda1]

When was your last hard inquiry on Equifax? If its less than a year ago there might be a way to get your score up to 600+

Message Edited by Takunda1 on 10-05-2007 10:13 AM

[PayYouNever]

Pay down any CCs you have, then ask for the rapid rescore. Revolving debt lines of credit are the most dangerous and seen as potential score killers

[Anonymous]

Well here's  what I decided to do ... I decided against the rapid rescore.  Even though I was late on my Target account, it was upgraded to a Target Visa.  Go figure. Since the new account has a different account number I'm guessing it would show up as a new debt and lower my score.  Therefore I didn't want to risk a rapid rescore.  Seemed like to many things could go wrong.

Instead of rescoring I asked my Loan Officer to give the Underwriter evidence that I had paid off the collections, wrote a heartfelt letter explaining the derogatory info on my credit report, provided an depth budget, signed up for budget couseling, and got a $5,000 gift from my father to show that I will have some cash reserves after closing. 

Nothing like begging, pleading. and praying!  I'll know next week if this approach worked.  Thanks all

[Anonymous]

Those are awesome rates for "only" a 600 mid....Who are you using? I'm looking at a couple places and to get 6.0% you either need to pay points or put a solid down payment down and that's with a 680 mid.

[Anonymous]

-Smart move-

Play the cards ya got.

[Anonymous]

I think the key is that I'm using a Loan Officer who specializes in first time home buyer programs.  Here's how the deal is structured:

• $500 downpayment from me.
• $3,000 soft second from local/state government or nonprofit. (no interest no payment)
• $5,000 gift from father.  Using $1,500 toward the transaction and keeping the other $3,500 as cash reserves.
• Using Fannie Mae's My Community Mortgage underwriting guidelines
• The Investor will be a local government that has a mortgage revenue bond program for 1st time homebuyers.

I bet most of us have seen the info commecials to sign up for seminars at a local hotel to find out about no interest and low interest loans and grants.  Skip the seminar and find yourself a really good first time homebuyer specialist.  Income guidelines for the programs vary.  The scenario I'm using the max income is $63,000 for a household of 1 to 4 persons.  The income limits go up for households over 4.

Keep your fingers crossed for me.  I haven't been approved yet and I don't know if there will be more hoops to jump through.  If I'm able to close later this month it will be worth all the work.

[Anonymous]

That's great for you jadamarie! I hope it all works out and those terms seem very good.