Please Help! I have No time left, and need help with scores ASAP!

[izzesparks]

I was not intending on buying a home, but was trying to get my husband's and my credit scores up, anyway. Then out of nowhere I fell in love with a house, was expecting it at all, but I must have it I cant think of anything else. I am so stressed out, and have been brought to tears, because I may lose my dream home. Luckily I have already gotten us on the right path to a healthier credit history, but we are still a long ways away. I have found a lender and a realtor, they are good so far, have not met either of them in person yet. My lender says its better to work on my husbands scores, although mines are higher, because his are simpler and faster to fix. My husbands FICO scores are EQ-508, TU-531, EX-646. His report is barely one page long.

on it is:

1) new auto loan opened 07-2010 no lates so far

2) $500 secured credit card opened 06-2010 - one 30 day late payment- was maxed out, just paid $250 on it 2 days ago.

3)LVNV collection acct for HSBC Orchard- settled and paid 1 week ago, not yet reported to bureaus

4)LJ Ross $503 - I am paying them monthly, but they are not reporting the payments.

5)2 disputes on file

6) 2 accounts  that are closed paid never late

that is all thats on his report

our lender gave us a list of three things to take care of on his report

1) pay CC to $100 balance (but I am going to pay down to $50)

2) remove all disputes- buying a homepath home, cannot have any disputes on file

3)pay off 2 collection accounts

what we have done so far-

A) Paid off LVNV - we got a huge settlement offer, it was wonderful!

B) paid CC down to $250

C) contacted EQ and TU about removing disputes

Problems we have ensued:

Cannot get ahold of experian, claims offices are closed because of storms for a whole week

LJ Ross will not let us settle my husbands account, unless I settle mines with his for only at 80%, which I think is totally ridicoulous, what if we were separated. he should only be responsible for whats on his reports.

Questions I have:

should I even pay-off LJ Ross? I learned from reading post on here, that when you pay-off old accounts it drops your score. should I just continue monthly payments?

Should we open another card in his name?

What can we do right away to raise scores?

I know I am asking the impossible, and most of this will take time, but i dont have much, I need to be able to put offer on home before it is gone.

I spoke to the bank that owns the home, and they do not require a pre-approval letter to accept offers on home, but my realtor wont put offer on home without one, or at least a pre-qual letter. My lender wont do pre-qual letters, only does pre-approval letters. My head is spinning. I only want a pre-qual letter to put offer on home. So that I can ask for 60 day finance clause. This will take home of market and give me time to wait while my husband's credit scores reflect the work I have done. my realtor says this is not legal, I heard that it is. Now i dont know what is true, I just want this home.

Please tell me what I should do.

Thank you in advance for any advice you give.

[Edited to remove some duplicated text.]

[izzesparks]

bumping- to get some replies

[Anonymous]

Who is the OC on LJ Ross? 

I got them off of my reports with the HIPAA process. 

I think you need to take a deep breath and work on both reports. 

I don't know if you can get his score up 100+ points quickly.

I know you're pining for this house and losing sleep over it, but I promise that there will be another one if this one doesn't work out. 

My offer on a house that I wanted was rejected in January - I offered, got a counter, countered it, and was flat-out rejected.  Owner wanted more than the location justified.  When I got the feeling that there was no way it would happen, I calmed myself by looking at every house available on the market - I came up with 16.  I then saw 6 more (I said to my realtor that day "I don't want to see ANY houses" - then I liked 3/6 of those.)  Then one more came on the market that I was considering seriously...when I was almost ready to put an offer in on one of those four, my dream home came on the market and I had to do a lot of fenagling to figure out how to finance it (no kitchen).   I basically went from being morose and never wanting to see another house to having an offer accepted on a better house than the one I wanted.

[OnTheRebound]

I will put in my two bits worth. I know you love this home so much you can't stand it. But you need to calm down and think this through. From what you posted, your chances are pretty slim getting approved for a mortgage at this time. You can't be in the process of cleaning up your reports and applying for a mortgage at the same time. It doesn't work that way. Rebuilding and cleaning credit is a process. More often than not, a very long process. First things first. If you worked diligently on your reports, I can see you getting a mortgage in a year, maybe.

There will be other homes out there that you will fall in love with when the time comes.

[IOBA]

Ask yourself how important is making that offer on the house?

If it's THAT important...

* ask your lender what the FICO minimum score has to be for pre-approval

* settle with the CA.  Eighty percent may be distasteful to you, but do you want the house?   Get the CA to write you a letter that says it will be considered paid in full (no money owed now or ever).   Ask them to delete it from the CR if/when/after you off the debt.  They may or may not delete, but it's worth a try.  

* consider paying off the cc entirely

You didn't mention down payment or closing costs.   Do you have it already saved?   If not, consider trimming down your life now.  Anything you can sell on Craigslist?  Can you reduce your cell phone plan?  Give up cable?   Start saving like mad!   Don't put anything on the cc's...go cash only.

You may need to document every deposit.  I use to photocopy the check and the deposit slip.  Whatever happens do NOT overdraw your account.

I hope this helps you!

[LIGHTNIN]

A lender will look at your husband scores and your scores.Then they look at his middle score which is TU-531.

Then your middle score. Then lender will use the lower score of the both of you.

Before the mortgage loan mess, lenders like to see a middle score of 620-640. As said before, ask the lender what is the min score.    

I would suggest getting your CS as high as you can.The higher your score the lower interest rate you can get.

A lower interest rate can save you thousands and thousands of dollars over the life of the loan.

So in case you do not get approved for this house, think of the money you can save once you get your scores higher.                 

Also the lenders like to see payments paid on time, with no lates in the past 12-24months.

Employment 2yrs at the same employer or 2yrs in the same field.

Very important....Have an emergency fund to pay for the bills, in case of an illness or a job loss.

With a home, there is always something that needs repaired or replaced.Just make sure you replace the money back into the fund.

Read,study and learn from the post on the mortgage boards. A mortgage is the biggest loan you will have in your life.

Take you time and dont rush into anything, because thats the way mistakes happen.

[izzesparks]

Thanks for the reply!!!

The OC on LJ Ross is Consumers Energy!!

Can I use the HIPPA for a utility company?

And are utilities reported to the bureaus? like DTE, BGE, etc.....

And how much do they count towards your score?

[RobertEG]

Lots of good advice, and it appears that you may be prematurely over-extending.

Mortgage loans, as you have seen, involve a lot more than just raw FICO scores.

FICO scores, in general, may lead primarily to pre-approval offers, and consideration of your interest rates should final approval be made.

But they nail down mortgage loan approval.

Paying a CA does nolthing to improve your FICO score, but is nonetheless something that most mortgage lendors will routinely require prior to any final loan approval.

That depletes your financial resources, without FICO score improvement. 

I agree that credit score improvement, and in parrticular attempts to secure CR deletion of reported derogs, should precede entering into a major loan application.

[izzesparks]

Thanks for reply!

our fico minimum must be a middle score of 660.

I have cut our cable back, I would cancel it but we are in a contract.

phone bills are next to be trimmed down

we do pay cash for everything and have not overdrawn yet at our new bank (knock on wood)

and my lender says he will sign us up for the next down payment and closing cost assistance program classes.

[izzesparks]

Thank you!!! great advice!