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Need HELP to apply for a VA Loan in October 2017

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Need HELP to apply for a VA Loan in October 2017

Need advice on how to settle a CO with the OC.

 

Long story short, back in 2008-2009 I lost my job and was unable to find work until October 2011. Throughout that time I basically lived off the credit cards and LOC that I had obtained.

 

Needless to say my SUV was repossessed; credit cards and LOC went late and eventually CO'd.

 

2014 I was re-hired with a good company:

 

I paid off the CO's and collections under $1200.
AMEX gave me the Optima Oasis card for repaying my CO.
I financed a SUV in March 2014 and it is current with no missed payments.

 

Which brings me to the present.

 

I began rebuilding my credit about 8 months ago. I obtained 3 secured cards, none report as secured 

I pay all in full before the statement date except for one card which I allow $15 to report to the CRAs.


02/18/16 FICOs:  EX 525 TU 535 EQ 531
11/18/16 FICOs:  EX 566 TU 593 EQ 589

 

Even with the CO's that I have paid, I still have about $85K in derogs reporting which is keeping my scores down.


I obtained my credit reports directly from EX, TU, & EQ.

 

The good news: derogs begin to age off of my reports in June 2017.

All but $19K will have aged off of all my reports by December 2017.

 

I would like to purchase a home and move in before March 2018. 

 

However the following will still be reporting on my reports until October 2018:


PenFed Auto Repossesion $5K
NFCU LOC CO $14K

 

I have my VA Certificate of Eligibility in hand, so all I need to do is get my reports clean.

 

I have signed up for FICO 3B in August 2016 and I have watched my scores including Mortgage Score continue to increase:

 

8/28/16

 

EX FICO 8 - 550 | EX FICO 2 - 540
TU FICO 8 - 568 | TU FICO 4 - 557
EQ FICO 8 - 545 | EQ FICO 5 - 496

 

11/18/16

 

EX FICO 8 - 556 | EX FICO 2 - 557
TU FICO 8 - 593 | TU FICO 4 - 570
EQ FICO 8 - 589 | EQ FICO 5 - 550

 

11/18/16

 

INQs: EX 1 | TU 1 | EQ 3

 

What I need is advice on how to approach both Navy Federal and PenFed in order to settle both accounts before September 2017.

4 REPLIES 4
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Established Contributor

Re: Need HELP to apply for a VA Loan in October 2018

Are you saying that over the next 16 months, about $70,000 in derogatory accounts are going to fall off of your credit report? 

Do any of them happen to be Student Loans, Jusdgements, Tax Liens, etc?

 

either way, even if all $85K fall off of your report, that doesnt honestly help in purchasing a home, it only helps your score.  When debt falls off of your credit report, thats basically all that happens, unfortunately, you still owe the money.

 

I dont want to be a wet blanket, but what I'm about to say is very important:

in all mortgage loan disclosures that you must sign, there is a section where you must acknowledge that you have disclosed ALL DEBT that you owe.    This includes debt that may not be listed on your credit report, such as the $70K (+-) that you mentioned above. Signing this form without disclosing all of your debt, is considered Mortgage Fraud and a  punishable crime.  

 

You will need to be upfront with a lender on these debts, and let them advise you on the bestr course of action.

 

A couple of ways this debt could come back to haunt you, would be a judgement if any of it is still within the SOL.  Also most collectors who have been quiet in the past,  will  start coming out of the woodwork if they even think you might be looking to purchase a home.

 

I promise you I only have you best interest in mind by mentioning these things, many people aren't aware that any debt no longer reporting, still has to be disclosed.  

 

it could still work for you to purchase Mar 2018, but please make sure you  know where you stand with some of these debts, before the last minute.



Chapter 7 Discharged & Closed Jan 2020
Message 2 of 5
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Regular Contributor

Re: Need HELP to apply for a VA Loan in October 2018


@2b2rich wrote:

Are you saying that over the next 16 months, about $70,000 in derogatory accounts are going to fall off of your credit report? 

Do any of them happen to be Student Loans, Jusdgements, Tax Liens, etc?

 

either way, even if all $85K fall off of your report, that doesnt honestly help in purchasing a home, it only helps your score.  When debt falls off of your credit report, thats basically all that happens, unfortunately, you still owe the money.

 

I dont want to be a wet blanket, but what I'm about to say is very important:

in all mortgage loan disclosures that you must sign, there is a section where you must acknowledge that you have disclosed ALL DEBT that you owe.    This includes debt that may not be listed on your credit report, such as the $70K (+-) that you mentioned above. Signing this form without disclosing all of your debt, is considered Mortgage Fraud and a  punishable crime.  

 

You will need to be upfront with a lender on these debts, and let them advise you on the bestr course of action.

 

A couple of ways this debt could come back to haunt you, would be a judgement if any of it is still within the SOL.  Also most collectors who have been quiet in the past,  will  start coming out of the woodwork if they even think you might be looking to purchase a home.

 

I promise you I only have you best interest in mind by mentioning these things, many people aren't aware that any debt no longer reporting, still has to be disclosed.  

 

it could still work for you to purchase Mar 2018, but please make sure you  know where you stand with some of these debts, before the last minute.


In May 2016, I contacted Veterans United to prepare me for obtaining a VA loan.

 

I am working under Veterans United Lighthouse program, but I wanted to seek input from this forum also.

 

My Veterans United rep has pulled my reports and advised me to wait until all the derogs fall off.  

 

Before they will go any further, they wanted my mortgage scores above 620.  Obviously the higher the better.

Next, since they have a list of my derogatory debts, they would then start reviewing everything to determine what may still need to be paid or settled.

 

Everything is beyond SOL.

 

No student loans

No Judgements

No Tax Liens

No foreclousures

 

It is all credit card debt plus the following two items:

 

PenFed repossessed my SUV and balance after repossession is $5K

NFCU LOC is $14K

 

I have retained an attorney that will contact both PenFed and NFCU in January 2017, such that, those debts can be paid or settled.

Message 3 of 5
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Re: Need HELP to apply for a VA Loan in October 2018


@Geordi wrote:

@2b2rich wrote:

.


In May 2016, I contacted Veterans United to prepare me for obtaining a VA loan.

 

I am working under Veterans United Lighthouse program, but I wanted to seek input from this forum also.

 

My Veterans United rep has pulled my reports and advised me to wait until all the derogs fall off.  

 

Before they will go any further, they wanted my mortgage scores above 620.  Obviously the higher the better.

Next, since they have a list of my derogatory debts, they would then start reviewing everything to determine what may still need to be paid or settled.

 

Everything is beyond SOL.

 

No student loans

No Judgements

No Tax Liens

No foreclousures

 

It is all credit card debt plus the following two items:

 

PenFed repossessed my SUV and balance after repossession is $5K

NFCU LOC is $14K

 

I have retained an attorney that will contact both PenFed and NFCU in January 2017, such that, those debts can be paid or settled.


I have heard nothing but good things about this program!  I bought my house last year through VU also and was reading about the light house on their website.  They even help people who are just a few points away from a qualifying middle score, get there and will request a rapid rescore (I think thats what its called) for them to close in time.

 

i know that its not always a requirement to pay these debts off in order to get a mortgage loan, but you do have to list them and you did.  Sounds like you have it all under control.  You would be surprised at the number of people who really misunderstand about debt obligations once it falls off reporting.

 

i also understand about bad luck streaks.  I first came here and became a member about 11 years ago as a single mom who had been trying to make ends meet on credit cards after a downsizing at my company.

 

I had gave up the struggle of paying what I could on already 'over the limit', maxed out cards, (something about as productive as pouring cups of water into the ocean), and only one of my scores was above  500 when I came here.

 

I never dreamed I would be able to buy a house, but I learned so much from these forums and today I own my own home, have a new (and for the first time in my life, RELIABLE) car, credit cards with a combines cl of about $40K, and have even co-signed on an auto loan for my kid.  I never forget the struggle, how far Ive come, and how much I never want to go back there.

 

 

 

 



Chapter 7 Discharged & Closed Jan 2020
Message 4 of 5
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Established Contributor

Re: Need HELP to apply for a VA Loan in October 2018

And your actual reason for the post was about Navy Fed and Pen Fed, sorry first glance I thought that was in your signature.

 

I'm not familiar with Navy, and I only have checking/svings with PenFed, but in other fotums Ive noticed people have mentioned that the closer to age off, the better chances of Good Will letters working for them at PenFed.  Its been awhile, so I'm not sure if its still the case.



Chapter 7 Discharged & Closed Jan 2020
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