My mortgage scores as of 1/8/22 were 521, 526, 574. I'm trying my best to get to at least 600, but ideally at least 640, in order to buy a home by 8/1/22. Big goal, I know! So, what do I tackle first?
3 credit cards:
Discover $997/$1,000
Capital One $273/$300
Capital One $286/$300
Personal loans:
Regional Finance: currently $1,835. Originally from June 2021 but was refinanced 12/21. The interest rate is very high on this one (I think around 75%). Payment is $160/mo. No lates
Upstart: $1,332 from 11/21. No lates. Payment $42/mo
7 collections: $4,105
NCB $2,050 (reporting new as of Aug 2021) (all 3)
National Healthcare Collection $271 (TU,Ex)
Sprint $145 (Eq,Ex)
Lvnv Funding $700 (all 3)
Charter $117 (Tu,Ex)
Trident Asset Management $614 (all 3)
Banfield $208 (TU,Ex)
As an FYI:
Student Loans total $53,319. I have an IBR plan approved for $53/mo when the payments start. They have been in forbearance since I left school, so they are current because of that.
Car Loan as of March 2021. No late payments. The previous car loan that was paid off when I got the new car hasn't had a late payment since April 2019
My thought was to pay off the personal loans, then pay down the credit cards, and then collections, but I don't know if that is best to maximize the the raise of scores to get the biggest increase first. I'm not sure if I'm going to be able to do all of this by the time I have to apply, but I'm going to start plugging away at it. If I get the personal loans paid off and the credit cards paid down to 50%, could that raise them to at least 600 score? Any advice is greatly appreciated!
@nhlbluesgirl wrote:My mortgage scores as of 1/8/22 were 521, 526, 574. I'm trying my best to get to at least 600, but ideally at least 640, in order to buy a home by 8/1/22. Big goal, I know! So, what do I tackle first?
3 credit cards:
Discover $997/$1,000
Capital One $273/$300
Capital One $286/$300
Personal loans:
Regional Finance: currently $1,835. Originally from June 2021 but was refinanced 12/21. The interest rate is very high on this one (I think around 75%). Payment is $160/mo. No lates
Upstart: $1,332 from 11/21. No lates. Payment $42/mo
7 collections: $4,105
NCB $2,050 (reporting new as of Aug 2021) (all 3)
National Healthcare Collection $271 (TU,Ex)
Sprint $145 (Eq,Ex)
Lvnv Funding $700 (all 3)
Charter $117 (Tu,Ex)
Trident Asset Management $614 (all 3)
Banfield $208 (TU,Ex)
As an FYI:
Student Loans total $53,319. I have an IBR plan approved for $53/mo when the payments start. They have been in forbearance since I left school, so they are current because of that.
Car Loan as of March 2021. No late payments. The previous car loan that was paid off when I got the new car hasn't had a late payment since April 2019
My thought was to pay off the personal loans, then pay down the credit cards, and then collections, but I don't know if that is best to maximize the the raise of scores to get the biggest increase first. I'm not sure if I'm going to be able to do all of this by the time I have to apply, but I'm going to start plugging away at it. If I get the personal loans paid off and the credit cards paid down to 50%, could that raise them to at least 600 score? Any advice is greatly appreciated!
Others may disagree with me but here is my take: get the credit cards paid down to AZEO for at least 4-5 months before starting the mortgage process. That is MONTLY not one time. The best credit scores are in files with AZEO and no bad things reporting. If it were me I would get the cards down and at the same time be working on getting those collections OFF your reports. Those are killing your scores with high utilization not the loans. You need an open loan reporting to keep your profile diverse.
I would pay LVNV (they will delete after payment and likely will take less) and start knocking out the small ones with settlement offers for PFD. DO NOT mention you want a mortgage or they will not settle for less. You give your leverage away. Use covid or any other emotional excuse along with expressing the desire to set things straight and start fresh etc.
When I bought my house last year I was 3 years post BK filing not DC. I had been doing AZEO for about 6 months even though I did not know I was going to end up purchasing a house when my apartment lease ended. The planets just happened to line up and I found an amazing house for under 300k and was under contract and closed in 29 days. Despite the BK reporting I had NO collections and no late payments post BK. My student loans were still in the covid forbearance and they did tag me with 1% but my DTI was only 29% and it didn't matter.
You have time to get those scores up before August but if it were me I would be getting utilization under control (what reports is what matters let a zero balance report then run it up again as long as what reports is low) and getting rid of those collections. The long term positive payment history is helping you right now with those loans. Once you get all that other stuff under control then get rid of the high interest loans.
@Anonymous wrote:
@nhlbluesgirl wrote:
Student Loans total $53,319. I have an IBR plan approved for $53/mo when the payments start. They have been in forbearance since I left school, so they are current because of that.
I'll let the more experienced folks on here tackle the rest, but I would highly suggest taking the student loans out of forebearance and paying the $53 a month. You want a several-month track record of that being your payment, or you will be hit with 0.5% of your total balance as your assumed amount owed for debt-to-income ratio purposes.
I didn't know that was even an option. Thanks!
@Cowboys4Life wrote:
@nhlbluesgirl wrote:My mortgage scores as of 1/8/22 were 521, 526, 574. I'm trying my best to get to at least 600, but ideally at least 640, in order to buy a home by 8/1/22. Big goal, I know! So, what do I tackle first?
3 credit cards:
Discover $997/$1,000
Capital One $273/$300
Capital One $286/$300
Personal loans:
Regional Finance: currently $1,835. Originally from June 2021 but was refinanced 12/21. The interest rate is very high on this one (I think around 75%). Payment is $160/mo. No lates
Upstart: $1,332 from 11/21. No lates. Payment $42/mo
7 collections: $4,105
NCB $2,050 (reporting new as of Aug 2021) (all 3)
National Healthcare Collection $271 (TU,Ex)
Sprint $145 (Eq,Ex)
Lvnv Funding $700 (all 3)
Charter $117 (Tu,Ex)
Trident Asset Management $614 (all 3)
Banfield $208 (TU,Ex)
As an FYI:
Student Loans total $53,319. I have an IBR plan approved for $53/mo when the payments start. They have been in forbearance since I left school, so they are current because of that.
Car Loan as of March 2021. No late payments. The previous car loan that was paid off when I got the new car hasn't had a late payment since April 2019
My thought was to pay off the personal loans, then pay down the credit cards, and then collections, but I don't know if that is best to maximize the the raise of scores to get the biggest increase first. I'm not sure if I'm going to be able to do all of this by the time I have to apply, but I'm going to start plugging away at it. If I get the personal loans paid off and the credit cards paid down to 50%, could that raise them to at least 600 score? Any advice is greatly appreciated!
Others may disagree with me but here is my take: get the credit cards paid down to AZEO for at least 4-5 months before starting the mortgage process. That is MONTLY not one time. The best credit scores are in files with AZEO and no bad things reporting. If it were me I would get the cards down and at the same time be working on getting those collections OFF your reports. Those are killing your scores with high utilization not the loans. You need an open loan reporting to keep your profile diverse.
I would pay LVNV (they will delete after payment and likely will take less) and start knocking out the small ones with settlement offers for PFD. DO NOT mention you want a mortgage or they will not settle for less. You give your leverage away. Use covid or any other emotional excuse along with expressing the desire to set things straight and start fresh etc.
When I bought my house last year I was 3 years post BK filing not DC. I had been doing AZEO for about 6 months even though I did not know I was going to end up purchasing a house when my apartment lease ended. The planets just happened to line up and I found an amazing house for under 300k and was under contract and closed in 29 days. Despite the BK reporting I had NO collections and no late payments post BK. My student loans were still in the covid forbearance and they did tag me with 1% but my DTI was only 29% and it didn't matter.
You have time to get those scores up before August but if it were me I would be getting utilization under control (what reports is what matters let a zero balance report then run it up again as long as what reports is low) and getting rid of those collections. The long term positive payment history is helping you right now with those loans. Once you get all that other stuff under control then get rid of the high interest loans.
Thanks! I definitely plan to keep the credit cards down, once they are paid. Both loans personal loans are high utilization since they are new. Does that not matter as much as the credit cards?
Glad everything worked out for you. I'm praying that the planets align for me too!
@VALoanMaster wrote:
@nhlbluesgirl wrote:My mortgage scores as of 1/8/22 were 521, 526, 574. I'm trying my best to get to at least 600, but ideally at least 640, in order to buy a home by 8/1/22. Big goal, I know! So, what do I tackle first?
3 credit cards:
Discover $997/$1,000
Capital One $273/$300
Capital One $286/$300
Personal loans:
Regional Finance: currently $1,835. Originally from June 2021 but was refinanced 12/21. The interest rate is very high on this one (I think around 75%). Payment is $160/mo. No lates
Upstart: $1,332 from 11/21. No lates. Payment $42/mo
7 collections: $4,105
NCB $2,050 (reporting new as of Aug 2021) (all 3)
National Healthcare Collection $271 (TU,Ex)
Sprint $145 (Eq,Ex)
Lvnv Funding $700 (all 3)
Charter $117 (Tu,Ex)
Trident Asset Management $614 (all 3)
Banfield $208 (TU,Ex)
As an FYI:
Student Loans total $53,319. I have an IBR plan approved for $53/mo when the payments start. They have been in forbearance since I left school, so they are current because of that.
Car Loan as of March 2021. No late payments. The previous car loan that was paid off when I got the new car hasn't had a late payment since April 2019
My thought was to pay off the personal loans, then pay down the credit cards, and then collections, but I don't know if that is best to maximize the the raise of scores to get the biggest increase first. I'm not sure if I'm going to be able to do all of this by the time I have to apply, but I'm going to start plugging away at it. If I get the personal loans paid off and the credit cards paid down to 50%, could that raise them to at least 600 score? Any advice is greatly appreciated!
In my experience, If the collections are reporting every month, they'll keep your scores suppressed regardless of what you're doing to try and improve them.
I would apply with a lender and have them run some credit simulators so you know exactly what you need to do.
Thanks! If I apply with one lender now, should I apply with multiple later? Wouldn't that be a ding, since it would be more than 30 days apart?
