Hi guys, my wife and I are finally about to begin the process for the USDA Guaranteed loan. We've basically paid off every Credit Card we have so our Debt to Credit ratio should be pretty low. We have $7400 total credit and only our Discover card has a balance of $120 (I was told to leave a balance on one of my cards). My FICO Score was a 643 before we started cleaning things up and I'm not sure what the score will increase to but it should be a decent amount (I hope). We had almost 50% debt across the cards before we cleaned it up.
We had one issue with collections from an old ATT bill that was a misbilling mistake and sent to collections. That is still on the credit report but I have a letter from an Executive of ATT admitting it was their mistake and saying they requested the collections agency remove it from my report. I've talked to my LO and she says this really isn't a big deal as, in her experience, Equifax drags their feet when removing negative items on your report.
Here is where my problem comes in. We have every piece of documentation printed that my LO requested (pay stubs, w2, bank statements, etc..) but we rent from a family friend. We pay her $300 a month cash and we have never gotten any type of receipt from her in 3 years. Again, she's a very close family friend (basically family) and she just basically picks the money up when she gets a chance. Also, the money isn't taken out at exactly the same time every month or in $300 withdrawals. Sometimes my wife gets cash back here or there, or gets that money out with my truck payment money, etc...
I read on the USDA guidelines that sometimes with an exceptionally high score, the rental verification won't mean so much. After asking my LO what credit score I would need to get up to that point where the verification wouldn't be a big issue, they kind of side stepped the question and said it would make the loan much stronger. I'm becoming fairly worried now as I have no proof of this and having a good credit score with no other issues doesn't seem like it's going to help.
Any advice on this or previous experience?
