How important is banking history?

Anonymous · ‎06-05-2015

My husband and I are in the process of cleaning up our credit to apply for a mortgage hopefully early next year. I have a checking account, business checking, and savings account with Chase. I have had an Amazon Rewards Visa with them for the last 6 years. My starting limit was only $400 and I have never asked for an increase. That was the only card we had, so we used it a lot, and paid it off multiple times per month. I requested a cli and was declined, due to a late student loan payment. I tried to recon with eo, but they refused to do anything. I'm livid, and want to close all of my accounts, but don't want to do anything to jepordize our mortgage approval.

Revelate · ‎06-05-2015

@Anonymous wrote:
My husband and I are in the process of cleaning up our credit to apply for a mortgage hopefully early next year. I have a checking account, business checking, and savings account with Chase. I have had an Amazon Rewards Visa with them for the last 6 years. My starting limit was only $400 and I have never asked for an increase. That was the only card we had, so we used it a lot, and paid it off multiple times per month. I requested a cli and was declined, due to a late student loan payment. I tried to recon with eo, but they refused to do anything. I'm livid, and want to close all of my accounts, but don't want to do anything to jepordize our mortgage approval.

Unless you're planning to go with Chase for the mortgage, if you want to switch, and we're talking a year out, doesn't really matter... really wouldn't matter regardless; I'd be more worried about the business checking account if I had verifications to do on that side.

FWIW, I wouldn't necessarily toss out Chase altogether from one unfortunate action by Chase credit cards (which is just one small part of Chase); my little Freedom or any future Chase card doesn't make that big of a difference seeing as how they aren't intrinsic to things I do care about both from Chase and the rest of my financial life. In your case, I'd absolutely evaluate the business relationship and prioritize that. My theory anyway.

frugalQ · ‎06-05-2015

you don't have to go through chase for your mortgage.

it may be beneficial to GW the late payment with the student loan lender. If it happened within 12 months of applying for your mortgage, you may run into issues getting approved.

good luck!

Anonymous · ‎06-05-2015

If that is the only credit card you have, however, dear lord don't close the credit card. That would probably tank your scores if you only have 1 open credit card and go to 0. Also remember the funds being used to buy the house (down payment, closing costs etc) need to be seasoned for at least 60 days, so sitting in the account for 2 months.

StartingOver10 · ‎06-05-2015

@Anonymous wrote:
If that is the only credit card you have, however, dear lord don't close the credit card. That would probably tank your scores if you only have 1 open credit card and go to 0. Also remember the funds being used to buy the house (down payment, closing costs etc) need to be seasoned for at least 60 days, so sitting in the account for 2 months.

^^^Yes. If you only have one open account (tradeline) I would strongly consider opening up two more revolving lines so you have them for a year prior to applying. Do you have any open installment tradelines?

Anonymous · ‎06-05-2015

Currently we have a Discover $1.6k, Capital One QS $2.5k and a Capital One Platnum $5k. All of these accounts are less than a year old though, so closing the amazon isn't something that we can do quite yet. We also have a revolving loan from a credit union to boost our scores. We have already moved our savings to a credit union, I've just been hesitant to move our checking accounts because I have heard that mortgage lenders like to see a long history with a bank. I would love to move all of my accounts to the credit union.

StartingOver10 · ‎06-05-2015

@Anonymous wrote:
Currently we have a Discover $1.6k, Capital One QS $2.5k and a Capital One Platnum $5k. All of these accounts are less than a year old though, so closing the amazon isn't something that we can do quite yet. We also have a revolving loan from a credit union to boost our scores. We have already moved our savings to a credit union, I've just been hesitant to move our checking accounts because I have heard that mortgage lenders like to see a long history with a bank. I would love to move all of my accounts to the credit union.

You don't have to have a long history with a particular bank. You have enough tradelines open, don't close any before you buy and close on your new home

If you do decide to move your checking and savings to your CU, then make sure you download all of your Chase statements so you have all of your records. Easy to do. You most likely won't even need them at all, but it doesn't hurt to have the records just in case.