BK Charge Offs

[Anonymous]

I was reviewing my husband's CR and realized that he will be having some credit accounts falling off his report next year that were included in his Ch 7 bankruptcy. One is a mortgage (foreclosure) and the others are credit cards. How will these dropping off affect his credit score? We are looking to purchase a house towards the end of next year and I'm trying to figure out if we should wait til these drop off to apply for a mortgage or if it even matters.

[TRC_WA]

It definitely matters.

The score increase with the baddies removed will be worth waiting for.

[Anonymous]

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@Anonymous wrote:

I was reviewing my husband's CR and realized that he will be having some credit accounts falling off his report next year that were included in his Ch 7 bankruptcy. One is a mortgage (foreclosure) and the others are credit cards. How will these dropping off affect his credit score? We are looking to purchase a house towards the end of next year and I'm trying to figure out if we should wait til these drop off to apply for a mortgage or if it even matters.

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As TRC noted - it does matter, but I would add that it really can go either way, I've heard some people get a boost and some get a slight drop - the general assumption is that drops are caused by AAoA effects. I think the deciding factor will be whether or not he has more recent derogs or not.

[TRC_WA]

Good point.  ^

As an example... I had 11 IIB accounts removed the other day that were from 2006-2009 (with the public record still remaining) and saw a 41 point increase even though my AAoA most definitely dropped.

I have the accounts listed in my sig that are 0-2 years old and 5 student loan accounts that are dated 2001 that most definitely helped offset the AAoA loss.