Pre-qualified! Want to polish that mortgage score

Anonymous · ‎05-14-2019

Hello fellow myFico mortgage subforum dwellers!

Good news! Was recently pre-qualified for a mortgage loan, planned to close next March-ish, 2020. Its new construction. The key comments from lender's pre-qual letter are pasted below.

My middle mortgage score was 679. We qualified with my income only, did not need DW whose credit score is a few of ticks lower. Now, race is on to build that score up to maximum! A few questions:

During the interim, we need to sell two properties and pay off those mortgages. Will my Fico score drop when my credit file no longer contains an open installment tradeline?
I am an AU on DW's secured Cap1 M/C. That account is 8 months old, with security deposit of $400. Up until now, we had been toying with idea of closing it altogether, but now think just leave it alone until after closing, next year. Agree?
This July I would be eligible to either PC or CLI request my QS. Should I do so, or just sit tight?
A settled Amex charge off is slotted to be removed on March 12, 2020 (according to a letter I received from Amex, after a GW request). I'm reticent to pursue EE on this given various horror stories, though its a possible lever. Thoughts?

------ from Lender Letter ------

This is not a final approval. Final approval of the Loan requires:
(1) [the lender] to verify the information the applicant has provided;
(2) The applicant’s and any applicable co-borrower’s, financial status and credit report to remain
substantially the same until the Loan closes;
(3) The collateral for the Loan (the subject property) to satisfy the lender’s requirements (for
example, appraisal, title, survey, condition, and insurance);
(4) The Loan, as described, to remain available in the market;
(5) The applicant and applicable co-borrowers, to execute loan documents the lender requires,
and
(6) Final Underwriting/Investor Approval.

pgtackle2003 · ‎05-14-2019

Hello and congrats on your pre-qualification. My first question is did they actually pull your credit? If so, then that means they're already satisfied with your credit and not sure the reason for the race to raise your scores

Anonymous · ‎05-14-2019

@pgtackle2003, yes indeed they pulled my CRs. Funny thing, I decided to pay the $59 to myFico, just to corroborate the lender's scores -- exact match.

Your second question reveals a huge omission in my OP! I was pre-qualified, but for a loan product that is a grade down from a standard conventional loan. This had more to do with my spotty payment past, than my current score. LO said, as those baddies age and if my score rises, there's a good chance I will qualify for better products and rates, next year.

DollyLama · ‎05-14-2019

@Anonymous wrote:
Hello fellow myFico mortgage subforum dwellers!

Good news! Was recently pre-qualified for a mortgage loan, planned to close next March-ish, 2020. Its new construction. The key comments from lender's pre-qual letter are pasted below.

My middle mortgage score was 679. We qualified with my income only, did not need DW whose credit score is a few of ticks lower. Now, race is on to build that score up to maximum! A few questions:
During the interim, we need to sell two properties and pay off those mortgages. Will my Fico score drop when my credit file no longer contains an open installment tradeline?
I am an AU on DW's secured Cap1 M/C. That account is 8 months old, with security deposit of $400. Up until now, we had been toying with idea of closing it altogether, but now think just leave it alone until after closing, next year. Agree?
This July I would be eligible to either PC or CLI request my QS. Should I do so, or just sit tight?
A settled Amex charge off is slotted to be removed on March 12, 2020 (according to a letter I received from Amex, after a GW request). I'm reticent to pursue EE on this given various horror stories, though its a possible lever. Thoughts?

------ from Lender Letter ------
This is not a final approval. Final approval of the Loan requires:
(1) [the lender] to verify the information the applicant has provided;
(2) The applicant’s and any applicable co-borrower’s, financial status and credit report to remain
substantially the same until the Loan closes;
(3) The collateral for the Loan (the subject property) to satisfy the lender’s requirements (for
example, appraisal, title, survey, condition, and insurance);
(4) The Loan, as described, to remain available in the market;
(5) The applicant and applicable co-borrowers, to execute loan documents the lender requires,
and
(6) Final Underwriting/Investor Approval.

1) It will drop a smidge on mortgage score, but not as much as it affects FICO 8.

2) Is it necessary to be an AU on this account? If your revolving credit is older than 8 months, have yourself removed as AU from account. The line of credit is not high enough to really lower any utilization and may not possibly be considered in UW.

3) CLI via soft pull only

4) I wouldn't poke the bear, however it might not reflect until April's 2020 reporting for deletion (after your proposed closing)

Questions

Is Amex your only derog? Any other closed or open accounts with lates that can be goodwill lettered, any collections?

What is your current overall utilization on revolving credit?

Alternate cards to report a balance every couple of months to maintain a reported credit history and payment history.

When January rolls around till closing, only let one Bank card report a balance. The others let report 0 balances by the statement cuts. Of the one bank card, do not let it report more than 8.9 percent, this includes interest if carrying a balance.

Anonymous · ‎05-15-2019

@DollyLama wrote:
Questions
Is Amex your only derog? Any other closed or open accounts with lates that can be goodwill lettered, any collections?
What is your current overall utilization on revolving credit?
Alternate cards to report a balance every couple of months to maintain a reported credit history and payment history.
When January rolls around till closing, only let one Bank card report a balance. The others let report 0 balances by the statement cuts. Of the one bank card, do not let it report more than 8.9 percent, this includes interest if carrying a balance.

DollyLama, thank you for the response! As far as being AU on DW's Cap1 M/C -- there is zero benefit. I'm nervous about removing myself at this time though, because I took a Fico8 hit last month (though only on Experian), when I removed myself as AU from her QS1 account. If she just closes the account, are the potential, minor, repercussions the same for my score?

I agree -- best not to, "poke the bear," regarding EE.

To your other questions --

6 of 9 closed accounts have derogatory marks, ranging from minor to serious. I've sent GW letters to Amex, BofA, and Chase and been rebuked by all. No collections.
Revolving credit utilization is $28 out of $38k. I habitually practice a, "close to Azeo," method. That is, sometimes I let a balance report on 2 of the 4 revolvers, but never a significant amount. Will implement a strict Azeo practice, as you noted, a few months prior to final close.