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Need 30 pts to get to underwriting

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Smashingwitty
New Member

Need 30 pts to get to underwriting

Our lender gave us a pre-approval so we could move forward on a home. We have a financing contingency. We were only 10 pts away so our lender knew just by dropping my credit utilization we would be ready to go. Note: We're also selling our home at the same time so our lender knew we had some wiggle room with an additional 60 days in our new home contract to find a buyer.

 

What changed? (1) My score tanked by -22 points due to a late payment on a Credit Boosting loan. I had issues switching cards and they reported it two months after the fact. (2) Our home sold the first day on the market for $15k over asking. 

 

Current Status: I'm currently -30 points away from the required score. My lender sent my credit report in for an official rapid rescore review and this is what I was asked to do:

 

1. Pay down Open Sky card to 12% utilization (it was at 86% at time of credit pull)

 

2. Pay down First Premier Card to 6% utilization (it was at 36% at time of credit pull)

 

3. Pay off $1,500 credit card charge-off that is still reporting + interest each month

 

4. Remove recent late payment (1 payment, 30 days late)

 

The Problem: I've completed 1-3 and only #1 and #2 have reported. I didn't get much of a boost. I've done everything to remove the recent late payment but they will not do it. Our lender cannot send in the rapid rescore without completing all items (1-4).

My miracle NEEDS to be a big increase from paying the charge off. When I use the myFICO simulator, it says I'll gain a +35 point increase from paying that off. Sounds like charge offs that report each month with interest tend to see more increases (based on this forum).

 

Finally, our buyers and sellers are both willing to move our closing date a couple weeks (currently at 2/3) if needed. But what in the hec is going to get me these points? I have a lot of stuff reporting each month, always on time. December payments haven't reported yet so I'm waiting for all my installment loans, mortgage and car payment to report + the charge off.

9 REPLIES 9
Mortgage-Specialist
Established Contributor

Re: Need 30 pts to get to underwriting

What score will you have once you get the 35 point increase? FHA or Conventional?

 

I will say, that the credit simulator is pretty accurate within a couple of points

Message 2 of 10
Smashingwitty
New Member

Re: Need 30 pts to get to underwriting

VA 580 mid-score is the requirement. I'm currently sitting at a 549 mortgage mid-score. 

The 35 pts would get me RIGHT where I need to be. That's not even including keeping utilization, low while underwriting is on-going.

Message 3 of 10
Smashingwitty
New Member

Re: Need 30 pts to get to underwriting

Our lender told us that the rapid rescore review estimated we would only gain three points by paying the charge off.

 

MyFICO simulator says "Pay down delinquent credit card balance" and when I put in the $1500 it says +35 points.

 

Seems pretty drastic compared to the formal rapid rescore review that came from our lender. 

Message 4 of 10
Mortgage-Specialist
Established Contributor

Re: Need 30 pts to get to underwriting

Manual underwriting I suppose.  You must not have any late payments on your credit within the past 12 months?

Message 5 of 10
Smashingwitty
New Member

Re: Need 30 pts to get to underwriting

Late payments are fine to move forward. But to move the needle and get my score where it needs to be - they are saying removing the recent late is required to get to 580. I don't have to remove it if I can get there. 

Message 6 of 10
Smashingwitty
New Member

Re: Need 30 pts to get to underwriting

Lender told me today that rescoring is a lot more expensive then it used to be so to submit one on behalf of the consumer- they are required to complete all items. 

Message 7 of 10
hornedfrog1985
Established Member

Re: Need 30 pts to get to underwriting

If you can remove the recent late payment do that, but depending on when the chargeoff is you don't want to mess with it if I'm thinking correctly. If it is too old you don't want it to update at all by paying on it. I bet thats why it would only raise your score by that much. Pay the balance down on the credit card is a safer bet imo. You could possibly negotiate with these places to pay it off to remove it completely. 

Message 8 of 10
rosco75
Regular Contributor

Re: Need 30 pts to get to underwriting


@hornedfrog1985 wrote:

If you can remove the recent late payment do that, but depending on when the chargeoff is you don't want to mess with it if I'm thinking correctly. If it is too old you don't want it to update at all by paying on it. I bet thats why it would only raise your score by that much. Pay the balance down on the credit card is a safer bet imo. You could possibly negotiate with these places to pay it off to remove it completely. 


This. I would try a pay-for-delete. Also maybe send the creditor who owns the 30 day late a goodwill letter as well. 


Message 9 of 10
nelson_xxiii
Regular Contributor

Re: Need 30 pts to get to underwriting


@Smashingwitty wrote:

Our lender gave us a pre-approval so we could move forward on a home. We have a financing contingency. We were only 10 pts away so our lender knew just by dropping my credit utilization we would be ready to go. Note: We're also selling our home at the same time so our lender knew we had some wiggle room with an additional 60 days in our new home contract to find a buyer.

 

What changed? (1) My score tanked by -22 points due to a late payment on a Credit Boosting loan. I had issues switching cards and they reported it two months after the fact. (2) Our home sold the first day on the market for $15k over asking. 

 

Current Status: I'm currently -30 points away from the required score. My lender sent my credit report in for an official rapid rescore review and this is what I was asked to do:

 

1. Pay down Open Sky card to 12% utilization (it was at 86% at time of credit pull)

 

2. Pay down First Premier Card to 6% utilization (it was at 36% at time of credit pull)

 

3. Pay off $1,500 credit card charge-off that is still reporting + interest each month

 

4. Remove recent late payment (1 payment, 30 days late)

 

The Problem: I've completed 1-3 and only #1 and #2 have reported. I didn't get much of a boost. I've done everything to remove the recent late payment but they will not do it. Our lender cannot send in the rapid rescore without completing all items (1-4).

My miracle NEEDS to be a big increase from paying the charge off. When I use the myFICO simulator, it says I'll gain a +35 point increase from paying that off. Sounds like charge offs that report each month with interest tend to see more increases (based on this forum).

 

Finally, our buyers and sellers are both willing to move our closing date a couple weeks (currently at 2/3) if needed. But what in the hec is going to get me these points? I have a lot of stuff reporting each month, always on time. December payments haven't reported yet so I'm waiting for all my installment loans, mortgage and car payment to report + the charge off.


Unfortunately, I don't have an answer for you since I myself am on the same boat as where u started which is where my question lies. I am currently 572, 566 & 570 on my mortgage scores and I was reporting high utilization on 2 cards which i've since paid off and waiting to see what it does to my scores but had no idea I could get a pre-approval with a contingency. I would love to explore thid avenue, if you could shine a lil more light on this. Hope things work out for u as well and u are able to get your home. Praying for u 🙏🏽

CURRENT FICO 8:





GOAL FICO 8 SCORES:




Mortgage 02/23 $370k | 2 Auto Leases $30k | 1 Personal Loan $2k | Rebuilding (No BK)
Message 10 of 10
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