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Hi all,
Kinda new to the boards but have read many of them so figured you guys could help me sort through my credit woes and help me put myself into position to be a 1st time home owner in the new (hopefully) future. My target goal is 4-6 months, but 1 year if more realistic.
Mortgage Scores:
EQ 583 TU 599 EX 567
Negative:
Collection 1: $1513 Money Key 5/2020 (Willing to pay but when I paid last one my score dropped. also have read I could possibly pay at closing if lender requires)
Collection 2: NCA Paid off 1/2021
Collection 3: TSI Paid off 8/2020
Open Credit Cards None ever late
Capital Bank Secured $120/$500 Opened Sept 2020
Capital Bank Secured $0/200 Opened March 2020
Self Lender Visa $109/500 Opened June 2020
Fingerhut $0/1000 Opened Aug 2020
Personal Loan
Upstart Loan $3750/4000 Opened 1/2021 (Was told i needed a variety of credit and this would help)
Fed Student Loan
$203,000 Currently deferred. Can do fully amoritized plan for $1300 or IBR for $600. Havent made changes to select one because FHA, Fannie Mae, Freddie Mac, and Conventional all have different requirements and way to manage student loan payments so I didnt want to make the wrong choice.
Income: $87,000
Child support payment $1,100/ month
I live in Texas if that means anything.
If additional data points are needed to assist me I would be more than happy to provide
Also 90 day late on student loan 3/19.
@onourwayfellas Below are benchmarks for FICO 8. Scores lenders use for mortgage are EX2, TU4, EQ5; should react similarly
Remember these aggregate utilization thresholds: 9%, 29%, 49%, 69%, 89%
Remember these individual utilization thresholds: 29%, 49%, 69%, 89%
If you're not crossing a threshold, you won't be getting points.
Look into AZEO Technique. All Zero Except One card reporting a small balance e.g. $5-$10. Use a bank card. Do not use a store card.
Get your CC aggregate utility below 4.5% for full FICO points optimization.
Scores will react positively with one revolving credit card reporting a balance.
I would recommend reading the below from ABCD2199
The Truth about Credit Card Utilization
My 11 Rules to Credit Rebuilding
FICO Score: What to pay down first?
From Birdman7
General Scoring Primer and Version 8 Master Thread rev.5.17.20
Here's a good post from
https://ficoforums.myfico.com/t5/Mortgage-Loans/What-can-I-do-to-raise-scores/m-p/6254704
Seems your new accounts and collections are your biggest culprits right now. Nothing you can do about the new accounts but allow them to age - you want them to be at least a year old tho evidence suggest mortgage scores penalize for new accounts up to 17 months. So don't add anymore right now.
The collections you've paid - have you tried getting them removed? You should contact each agency and request a Goodwill deletion - they may be inclined to grant the request since you've paid them already.
The one that you still owe - have you asked if they will agree to a pay for delete (PFD) arrangement (payment in full in exchange for removal from your reports)?
@thornback wrote:Seems your new accounts and collections are your biggest culprits right now. Nothing you can do about the new accounts but allow them to age - you want them to be at least a year old tho evidence suggest mortgage scores penalize for new accounts up to 17 months. So don't add anymore right now.
The collections you've paid - have you tried getting them removed? You should contact each agency and request a Goodwill deletion - they may be inclined to grant the request since you've paid them already.
The one that you still owe - have you asked if they will agree to a pay for delete (PFD) arrangement (payment in full in exchange for removal from your reports)?
1. No, I hadn't tried to get the paid ones removed. I can try that.
2. I requested PFD and was told that they can't do that.
Thanks
@onourwayfellas wrote2. I requested PFD and was told that they can't do that.
Is the debt still within SOL for debt collection in your state? If they are still within the time frame to take legal action - pay it so you're not at risk if having a judgment filed.
If it is outside of SOL then--
Is the tradeline updating each month? If so, it is going to keep your scores suppressed - I know you said you've experienced score drops after paying a collection -- that often happens with the final update to reflect payment - but it's beneficial in the long term. Paying it is the only way to prevent future updates and allow your scores to recover.
Also, once paid, they may be willing to remove the tradeline even though they won't agree to a PFD right now. Once they receive payment many collection agencies no longer care about reporting.
My advice is to pay it (in full or settle) and work towards removal afterwards.
@thornback wrote:
@onourwayfellas wrote2. I requested PFD and was told that they can't do that.
Is the debt still within SOL for debt collection in your state? If they are still within the time frame to take legal action - pay it so you're not at risk if having a judgment filed.
If it is outside of SOL then--
Is the tradeline updating each month? If so, it is going to keep your scores suppressed - I know you said you've experienced score drops after paying a collection -- that often happens with the final update to reflect payment - but it's beneficial in the long term. Paying it is the only way to prevent future updates and allow your scores to recover.
Also, once paid, they may be willing to remove the tradeline even though they won't agree to a PFD right now. Once they receive payment many collection agencies no longer care about reporting.
My advice is to pay it (in full or settle) and work towards removal afterwards.
Still within SOL. I offer to settle they would only accept full balance which I am fine with paying. I just didn't want to pay and have it drop my score any lower.
Thanks
@onourwayfellas wrote:
@thornback wrote:
@onourwayfellas wrote2. I requested PFD and was told that they can't do that.
Is the debt still within SOL for debt collection in your state? If they are still within the time frame to take legal action - pay it so you're not at risk if having a judgment filed.
If it is outside of SOL then--
Is the tradeline updating each month? If so, it is going to keep your scores suppressed - I know you said you've experienced score drops after paying a collection -- that often happens with the final update to reflect payment - but it's beneficial in the long term. Paying it is the only way to prevent future updates and allow your scores to recover.
Also, once paid, they may be willing to remove the tradeline even though they won't agree to a PFD right now. Once they receive payment many collection agencies no longer care about reporting.
My advice is to pay it (in full or settle) and work towards removal afterwards.
Still within SOL. I offer to settle they would only accept full balance which I am fine with paying. I just didn't want to pay and have it drop my score any lower.
Thanks
Your scores will recover. A judgment will require payment anyway and will be an added headache.