Need Advice Please !!

[Anonymous]

Current Scores :
TU - 612
Eq - 621
Ex - 643

Baddies :
Chapter 13 (Drop off 10/18)
Chapter 13 (ended 2014) > Due to divorce
Chapter 7 (ended 2013)>

Charge Offs w/balances :
Tower Loan - 6445.00 (drop off 9/18)
American Honda - 2255.00 (drop off 9/18)

Current Credit Cards:
Discover - 0.00 of 1000.00 (unsecured)
Capital One - 0.00 of 300.00 (unsecured)
First Choice - 187.05 of 200.00 (secured) (no statement yet )
Fingerhut - 31.93 of 400.00 (no statement yet )
A/U Acct. - Capital One - 75.46 of 200.00 (no statement yet)

Installment Loans :
Credit Union Credit Builder - 795.21 of 1000.00
Self Lender Credit Builder - 332.10 of 550.00

No collections
Have 6 charge off's showing 0.00 balances, paid
Have 11 past accounts in good standing/paid as agreed

I'm trying to get my scores up by February for closing on home in April, and need any advice offered to help me achieve getting my scores up, I'll provide any information that's helpful if anyone can help me to get on right path. Thanks in advance.

[Anonymous]

Where are you getting your credit scores from?

There's not much that can be done about your baddies since you have a handful of them.  Major score improvement doesn't come from the removal of just a baddie or two if you have a bunch, it comes when the final baddie is removed.  Since that's unlikely for you, I'd steer you away from the "payment history" sector of the FICO pie and focus your efforts elsewhere.

Specifically, start with AZEO, meaning you want all of your credit cards to have zero balance except one.  That one, only allow it to report a very small balance such as $5.  Your First Choice credit card is maxed out in the eyes of FICO, so if that reports (or has reported) it will result in a big scoring penalty.  You always want to get in the habit of paying in full to avoid paying interest, but also an additional payment can help to bring your card(s) down to $0 before the new statement cuts (or down to $5, if that's your AZEO card).

What's the deal with "credit builder" installment loans?  I know nothing about them.  Did you take them out for the reason the name suggests, simply to build credit?  If so, they are actually hurting your score right now, as your aggregate utilization between the two loans is above 70%.  You want this number to be less than 9%.  I don't know how those loans are structured... if you pay them down significantly, does that push off your payment due date many months, or are you still required to make a payment the following month?  If it pushes out your due date, pay those loans down to 8.99% or less of the original balance RIGHT NOW if you can.  That would be leaving around a $139 or less balance between them.  You could pay one off entirely and leave $139 on one, pay one down to $70 (or less) and the other to $69 (or less).  Once you hit less than 9% aggregate utilization on these loans, you'll see a 15-20 point increase to your scores once they report the new balances.  If these aren't the type of loans that you can pay down significantly and push off the payment due date many months by doing so, you may want to search out the SSL Technique which DOES allow you to do this.  In that case, I'd say just pay off the 2 loans you have now and employ that SSL Technique.  If you can provide a bit more information about the purpose/structure of the 2 current loans you have, we can offer better advice.

That's really all you want to do right now.  Do you know how many inquiries you have on your credit report from the last 12 months?  Do you know your AAoA, AoOA and AoYA?  These pieces of information can be useful to us.  The bottom line though is that you don't want to apply for ANYTHING between now and when you go for that mortgage.  Not applying for anything will help your scores over this period of time leading up to that big day. 

[Anonymous]

The two loans, one my Credit Union, second at Self Lender were both done to get a credit mix, and yes if I pay them it puts payment at a future date, so any extra payment comes off front of these. On equifax I have 4 inquiries, TU I have 19 , Ex showing 15. AAoA on these are Ex 4 yrs, TU 5 mths, Eq 1 yr 4 mths, I use MyFico for scores as well. First choice is scheduled for payoff 5 days prior to statement, discover and fingerhut and capital one all are at 0 so I need to alter to leave balance of 5.00 on one before they all report between October 25th and November 10th, I can pay these Builder loans off on 20th, I think it's best idea if will help scores. Thank you for your input.

[Anonymous]

I just closed out the self Lender loan, so it's no longer a factor, now have to work on Credit Union as it's at 18% loan and shows balance of 791.12 of 1000.00 and payment is 43.54 every two weeks, might just need to pay this off as well.

[Anonymous]

If you pay off the second loan before employing the SSL technique, your score will drop, not go up. So, either get the SSL on your report first, or, don't close your second loan... But do pay it down to $89 or less as on $1000 of total installment original balances (which will be the case when your other one reports closed). That way you're at 8.9% or less utilization and you'll get a 15-20 point increase. If they'll let you pay it down to $5 or so I'd do that, then just pay off the final $5 a year from now or whenever that final payment is actually due. Do make sure you employ the SSL technique a good month or ideally 2 before paying off the loan, though, so that you don't go without an open installment loan on your credit reports at any given time.

I'm also a bit confused regarding the AAoA you listed for each bureau. Usually they are pretty close, but yours are off by several years... How are you calculating this? Also when listing your inquiries, be sure to only list those from within the last 12 months since those are the only ones impacting your score. Those that are 12-24 months old are still present on your reports, but do not impact FICO score.

[Anonymous]

There's some things reporting on specific bureaus but not all, but that's just what shows, not thinking it's accurate. Okay on the loan, since each payment I make puts it another month out, just pay it within one payment, 43.54/biweekly of being paid off ? And let it sit until its due ? I'm not sure how all this works but it will pay out 12 months in July 2018. I'm not sure what this SSL even is, I know nothing much about credit, except I need it now lol.

[Anonymous]

Just do a search for Share Secure Loan technique and read the first couple of posts in that thread.  It's basically starting with a $500 secured loan that you pay back $450-$460 of immediately, then for the course of 4-5 years you just pay $1 a month or something.  Having a simple loan like that in place carries the same weight as an auto loan almost paid off, mortgage almost paid off, etc.  FICO doesn't discriminate against the different installment loans.  So long as you have one present that's almost paid off, you're getting maximum FICO benefit.  So, if you can pay your one loan down to about 8% of the original balance (as far down to 1%) and just let that balance sit there for as long as they'll let you, you'll get maximum FICO scoring benefit.  You just want to employ the SSL technique a month or two before that loan is closed out so that you don't go any time without having an open installment loan that's almost all the way paid off present.

[gameofthrones]

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@Anonymous wrote:
The two loans, one my Credit Union, second at Self Lender were both done to get a credit mix, and yes if I pay them it puts payment at a future date, so any extra payment comes off front of these. On equifax I have 4 inquiries, TU I have 19 , Ex showing 15. AAoA on these are Ex 4 yrs, TU 5 mths, Eq 1 yr 4 mths, I use MyFico for scores as well. First choice is scheduled for payoff 5 days prior to statement, discover and fingerhut and capital one all are at 0 so I need to alter to leave balance of 5.00 on one before they all report between October 25th and November 10th, I can pay these Builder loans off on 20th, I think it's best idea if will help scores. Thank you for your input.

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@I agree with the other good advice that the other members posted regarding SSL techniques. The quantity of hard inquries that you have is high on 2 of the CBs. The scores begin to recover from HI after @6 months, after 1 year they do not effect your score, and after 2 years they automatically will fall off. How old are your most recent inquries? I have found that sending a letter to the creditors and CBs requesting to verify the HI causes them to fall of the reports like flies. It takes work, and the the letters should be sent via certified mail. You could realize a 2-5 point increase per HI removal. Good luck.

[Anonymous]

I really appreciate these great responses, and I am diligently working on this, on the one loan left I scheduled a payment of 646.64, which takes it to only one monthly payment being left, due July 2018, and will be at 8.7%, thank you for that, also remaining 4 cards, discover, first choice, capital one, fingerhut will all be at 0.00 balance except first choice, it will be 5.00, which is 2.5% alone, and I'm also awaiting the a/u entry off my wife's 0 balance capital one. I'm going to definitely get these letters out as soon as I get back home from work, think that's a great idea, and again, thanks for the awesome advice, keep the suggestions coming as I'm willing to try almost anything I can do to raise score, especially mortgage soon.

[Anonymous]

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@gameofthrones wrote:

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You could realize a 2-5 point increase per HI removal.

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This is not likely and the OP could just as easily receive a 0 point increase for the removal of multiple inquiries.

A 2-5 point increase for 19 inquiries would be 38-95 points.  I doubt removal of all of them would even land in that range to be honest.  There are rapidly diminishing returns with inquiries.  Sure the first 3-4 may result in a 10-15 point drop, but then the next few will impact less, then the next few less and eventually once you get to 10-12 they don't impact score AT ALL any longer.  The OP has 19 on one bureau.  Taking that number down to 12-14 would have ZERO impact on his score, assuming all the inquiries are scoreable.  If he were to cut that number from 19 down to 9, which is less than half, at most he'd see is a few points total, not a few points per inquiry removed.  OP, I just don't want you to get the impression that your inquiries are significantly holding back your score, because they are about the least meaningful piece of the equation when it comes to your FICO scores.