Rebuilding for a mortgage

[Trashtruck]

Hi everyone I'm currently working with my wife to get up to snuff on my credit score. She is basically 800 in all of them. However I've been working on a rebuild since 2020.

As of 2/23

My current Fico 8:

EQ: 661 TU: 641 exp: 674

fico 5, 4, 2:

Eq: 663 tu: 678 exp: 672

My report still has a charge off on EQ and TU for $138 which is supposed to fall off in April or may.

there is also a collection with NCA for $734 with DofD as 8/16. Experian shows it should fall off around 5/23.

I also have a cc that Closed/CO in 2020 that I paid in full including interest/fees.

I also have various late payments through the years 2020 and prior. Nothing in the last 2-3 years.

after reading advice here, I asked for early exclusion for the unpaid CO and collection from the CRAs. I called TU and asked for obsolete info to be removed (they said it would be a dispute) and for the other two I used their online portal and said I don't dispute, but am asking for EE.

As of this morning I got an alert from CapOne credit wise saying my score improved (they do TransUnion VS). I checked and sure enough those two baddies I asked to be removed were removed and my VS score for TU went up 32 points to 751. I know it isn't the same as fico, but in theory if that's actually removed my score should increase right?

Now for the good and ideas for other improvements. I have three CCs open. 

Cap one: $0/$800 limit open 4+ years oldest account

chase: $434/$3500 open over a year

discover: $567/$6500

my understanding is I can AZEO to say my discover and get it below 5% and get a few more points added.

we currently have an income of $175k/year so income won't be a problem. Our current DTI not including our current house(only she is on loan) is $1500/month (cars and a student loan). We're looking to build a home in our area and are hoping to be approved for a loan from $400-$550k. The mortgage person were talking to said we'll be approved on DTI, but I should get my score higher to help rates etc. they specifically said to get that TU up. Now that it should be higher in a month when my ccs can get to AZEO and less than 5% utilization would that be enough?

the plan is to get the pre approval now so we can get a build started. Then when the build is actually completed the baddies will be off of my CR and hopefully my score will be the highest possible without waiting many years for the 2020 to fall off.

[Trashtruck]

Myfico came back with an update for my Fico8 score for TU: 672

I figure that the mortgage score should be up too for TU even though it was pretty high compared to Fico8 already.

I hope they actually EE them and not just going to show back up in 30 days.

Do you think that these scores are enough to get a preapproval? That will decide if we start that process or not.

[Mortgage-Specialist]

Theree a better than 50% chance youd be approved for a Conventional loan but you'll definitely get approved for FHA

[Trashtruck]

I figured I would be approved for at least 400k, but was curious what my max would be.  I feel bad I'm holding back my wife so far from getting the dream forever home.

I've messed with the simulator and it says I won't lose any points with a mortgage application. That doesn't seem right. Shouldn't at least go down a few points for an inquiry? I don't have any on my reports though so maybe that's why.  Also, from my understanding any pulls for mortgage within 2 weeks I think will be considered one inquiry right?

[donkort]

All your mortgage pulls should be combined into one pull if all occur within a certain time period (I believe it's 45 days).

Two recent inquiries shouldn't bring your score down.

I have higher scores----but my scores didn't go down even when I had 5 recent inquiries.

[Trashtruck]

Ok thanks!

[VAMortgageGuy]

Ask your loan officer to run a credit simulator. I would also look at the date last reported on the collection and the charge off. If those accounts are reporting monthly, they're likely suppressing your scores. As a loan officer, I would run a credit sim and delete the collection and change the charge off to paid, zero balance, to see how that would impact your scores. You could see a significant increase in your scores.

[Trashtruck]

Ok I will do that. Thanks for providing me some more information.

My Credit Karma equifax VS also jumped up this morning 31 points.  Hopefully that is a good sign for my FICO 8 and 5,4,2 scores.

[Trashtruck]

Just got the mail yesterday from TransUnion that they were officially deleting the Early Exclusions off of my credit report. I'm so glad I asked for the EE. Hopefully this cements it for others to try as well.

Edit: my TransUnion mortgage score jumped from 678 to 682.

[donkort]

680 is a good threshold!  Congratulations.