preparing for a mortgage

[Anonymous]

Wife and I had poor credit for many years. Let most of the bads age off and now only have one negative each on our reports that is over 3 years old. Next year we are going for a mortgage. Haven't pulled all of our mortgage scores, but my EX mortgage is 672. My fico 8 and 9 all range from 704-749. I had started on my rebuild first and got my first credit card in March 2018. In the 2nd half of 2018 I got a new auto loan and 7 more cards. In January I got 2 more cards and March got my 3rd NFCU card. I am done at this point. If we don't apply for a mortgage until March 2020, I will be 1 year AoYA and 2 year AAoA. So I expect my mortgage scores should be over 700 on all bureaus.

Now my wife got her first 2 cards 10/18 and her third 1/19. So she has 3 cards now but has no loan. Not sure of her mortgage scores but all of her fico 8-9 that we have access to are low 700s. I am going to drop her as an AU on the 2 cards I have her on to get her AAoA up. I think she will be over 3 year AAoA at that point and will receive a significant bump from that. She has no active loans on her report. Just a paid off loan from 2015 that has numerous lates.

So what I am trying to decide is if she would benefit more from doing nothing else at this point, or getting an NFCU SSL and paying it down? It would most likely drop under AAoA 3 years. And would make her AoYA under 1 year when we apply for a mortgage. But would give her an active loan and the points for it being 8.95 remaining.

Which path would be most beneficial for a mortgage in a year from now? Thank you  

[Anonymous]

In one part of your post you say that the mortgage app will be "a year from now."  In another part you suggest it will be 11 months from now (March 2020).  11 months vs. 12 months matters a lot due to the impact on AoYA.  Which will it be do you think?  Is it possible that it might be delayed until May 2020?

In one part of your post you say that your wife has exactly one negative mark.  In another part you say that your wife has "numerous" lates.  Which is the most accurate?

[Anonymous]

It is possible we could hold off until May. It really all depends on the new homes in our area. I obviously would like to hold off until May and get her the SSL now but at the same time if it looks like it’ll save us money on the price of the home or the right home, then we might have to pull the trigger earlier. So that is why I’m wondering if the impact of AoYA is more impactful than a current loan almost paid off.

As far as my wife, what I meant and I apologize for not being specific, there were numerous lates but only on one account. And none of the lates were after 11/15. So it’ll be about 4-1/2 years old for the most recent by the time we apply. And that was through Wells Fargo Dealer Services which we couldn’t get any help from in removing.

Hope that clarifies a bit.

[Anonymous]

If you could be confident that you could wait until May, I would if I were you do the SSL.  But as you cannot be confident of that, I'd scap the idea of the SSL.

Two of the three mortgage scores ignore installment loan amounts anyway.

[Anonymous]

Thank you. I will skip the SSL then. Hopefully her aging of accounts will help her get mortgage scores over 700.

[derboesekoenig]

How did you manage to get 11 credit cards in one year?? Wow. Just wow

[RobertEG]

If you have a prospective lendor in mind, I would clearly recommend an initial consultation with them regarding any actions that you should take prior to application.

Each lendor uses specific underwriting criteria, and thus their recommendations are based in reality of what will be used in your underwriting process.  Getting a review by them of their specifics would be preferable to any general comments from others based on their different file histories and different lendors.

[Anonymous]

Thank you all. I will probably hold off on the SSL for the wife for now.

And as far as 11 cards in a year, I started with none. Got a secured in 3/18. Then got Amex gold and disc in 8/18. 9/18 I got nfcu, penfed, and uber. Waited until 11/18 got auto loan through penfed. 12/18 I got 2nd nfcu and 2nd Amex . 1/19 got usaa and savor. And then in 3/19 3rd nfcu.

So yeah I’m done. I’ll probably close a few before I apply for the mortgage. There are some with $1k limits so if I close those they won’t hurt my util and from a rewards perspective I get an equal or close enough reward on another card.

Also I’m looking into nfcu for the mortgage as well. So maybe I will see if I can meet with someone for their opinion. Thanks for that suggestion Robert