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Rebuilding...Again

Scff506
Established Member

Rebuilding...Again

Hey all,

 

Long story short, negelcted credit for about the past 9 years.  No excuses, just trying to move past it.  Last year I began rebuilding, obtained 3 cards from Capital One, LendUp and Merrick Bank.  Life happened, and cards were charged off.  We're finally in a position to fix this mess and we're looking to buy a house vs renting and paying $1900 a month for an apartment.  Current income is right at $75,000 a year by myself, my wife is currently unemployed thanks to COVID-19 and collecting unemployment.  My credit is as follows:

 

Open Accounts:

AU on NFCU Card $708/700 Balance

PenFed LOC $183/500

Car loan with Santander, Current

Car Loan with Credit Acceptance, Current.

West Creek Financial Lease/Purchase $452 Balance

Progressive Leasing on a Bestbuy purchase last Christmas $563 balance

No credit cards of my own

 

 

Negatives:

Capital One Charge-Off $353 balance

Merrick Charge-Off $964 balance

Mission Lane/LendUp Chare-Off $646

EOS-CCA Collection $814(going to attempt a PFD on this tomorrow, have a settlement offer for 50%, going to try for the delete)

Affirm Inc Collection $364

South Jersey FCU Chargeoff from 2015 that's still reporting $3,356 balance

Consumer Portfolio Services, Voluntary Repo in 2017 $15,000 balance(not sure what the vehicle sold for)

 

Current Experian score is a 569 with my Score 2 being a 661(not sure why this is)

 

I'm waiting to pull my other scores until I take care of some of these items.  Obviously the recent lates and chargeoffs are hurting.  My plan is to take care of EOS-CCA collection, the Affirm collection, then begin paying the rest of the items down.  My question is 

1) Does it make sense to pay the charge-offs last? Paying the leases will free up $220 a month in payments

2) Why is my mortgage score so much higher than my Fico 8?  I applied through a Mortgage company and the preliminary screener called and said my score was only a 520 but a loan officer would be calling me this week.

3) Should i try for a NFCU secured card now or wait?  Again, I have no credit cards of my own but we have been banking with NFCU for the past year or so.  My wife's credit is also abysmal so I'll be trying to tackle what I can with that at the same time, though she has a foreclosure showing for the next few years so the house we purchase will solely be in my name.

 

Again, mistakes were made, I've learned from it and trying to get past this.  Does this seem like a reasonable plan?  Thanks in advance.

Message 1 of 5
4 REPLIES 4
FiresOut
Super Contributor

Re: Rebuilding...Again


@Scff506 wrote:

Hey all,

 

Long story short, negelcted credit for about the past 9 years.  No excuses, just trying to move past it.  Last year I began rebuilding, obtained 3 cards from Capital One, LendUp and Merrick Bank.  Life happened, and cards were charged off.  We're finally in a position to fix this mess and we're looking to buy a house vs renting and paying $1900 a month for an apartment.  Current income is right at $75,000 a year by myself, my wife is currently unemployed thanks to COVID-19 and collecting unemployment.  My credit is as follows:

 

Open Accounts:

AU on NFCU Card $708/700 Balance Get off this card ASAP. Its fully utilized and over the limit.

PenFed LOC $183/500

Car loan with Santander, Current

Car Loan with Credit Acceptance, Current.

West Creek Financial Lease/Purchase $452 Balance

Progressive Leasing on a Bestbuy purchase last Christmas $563 balance

No credit cards of my own

 

 

Negatives:

Capital One Charge-Off $353 balance

Merrick Charge-Off $964 balance

Mission Lane/LendUp Chare-Off $646

EOS-CCA Collection $814(going to attempt a PFD on this tomorrow, have a settlement offer for 50%, going to try for the delete)

Affirm Inc Collection $364

South Jersey FCU Chargeoff from 2015 that's still reporting $3,356 balance

Consumer Portfolio Services, Voluntary Repo in 2017 $15,000 balance(not sure what the vehicle sold for)

 

Current Experian score is a 569 with my Score 2 being a 661(not sure why this is)

 

I'm waiting to pull my other scores until I take care of some of these items.  Obviously the recent lates and chargeoffs are hurting.  My plan is to take care of EOS-CCA collection, the Affirm collection, then begin paying the rest of the items down.  My question is 

1) Does it make sense to pay the charge-offs last? Paying the leases will free up $220 a month in payments

2) Why is my mortgage score so much higher than my Fico 8?  I applied through a Mortgage company and the preliminary screener called and said my score was only a 520 but a loan officer would be calling me this week.

3) Should i try for a NFCU secured card now or wait?  Again, I have no credit cards of my own but we have been banking with NFCU for the past year or so.  My wife's credit is also abysmal so I'll be trying to tackle what I can with that at the same time, though she has a foreclosure showing for the next few years so the house we purchase will solely be in my name.

 

Again, mistakes were made, I've learned from it and trying to get past this.  Does this seem like a reasonable plan?  Thanks in advance.


No way around it really. Paying CO's first will do more good so they quit updating and no more maxed util'ed cards and accounts reporting. Then tackle the CA's. Find out whats owed on the car after auction and what the balance is now. No tricks or special ways. Just have to tackle the debts. But more credit wont help for now. Get the past over and done with and then you can get a few cards. It will be a while before a home loan. Spend that time and try to settle these baddies. No mortgage UW will approve you for a home until the past is all at $0 balance. Good luck!

Message 2 of 5
LaHossBoss
Valued Contributor

Re: Rebuilding...Again


@Scff506 wrote:

Hey all,

 

Long story short, negelcted credit for about the past 9 years.  No excuses, just trying to move past it.  Last year I began rebuilding, obtained 3 cards from Capital One, LendUp and Merrick Bank.  Life happened, and cards were charged off.  We're finally in a position to fix this mess and we're looking to buy a house vs renting and paying $1900 a month for an apartment.  Current income is right at $75,000 a year by myself, my wife is currently unemployed thanks to COVID-19 and collecting unemployment.  My credit is as follows:

 

Open Accounts:

AU on NFCU Card $708/700 Balance

PenFed LOC $183/500

Car loan with Santander, Current

Car Loan with Credit Acceptance, Current.

West Creek Financial Lease/Purchase $452 Balance

Progressive Leasing on a Bestbuy purchase last Christmas $563 balance

No credit cards of my own

 

 

Negatives:

Capital One Charge-Off $353 balance

Merrick Charge-Off $964 balance

Mission Lane/LendUp Chare-Off $646

EOS-CCA Collection $814(going to attempt a PFD on this tomorrow, have a settlement offer for 50%, going to try for the delete)

Affirm Inc Collection $364

South Jersey FCU Chargeoff from 2015 that's still reporting $3,356 balance

Consumer Portfolio Services, Voluntary Repo in 2017 $15,000 balance(not sure what the vehicle sold for)

 

Current Experian score is a 569 with my Score 2 being a 661(not sure why this is)

 

I'm waiting to pull my other scores until I take care of some of these items.  Obviously the recent lates and chargeoffs are hurting.  My plan is to take care of EOS-CCA collection, the Affirm collection, then begin paying the rest of the items down.  My question is 

1) Does it make sense to pay the charge-offs last? Paying the leases will free up $220 a month in payments

2) Why is my mortgage score so much higher than my Fico 8?  I applied through a Mortgage company and the preliminary screener called and said my score was only a 520 but a loan officer would be calling me this week.

3) Should i try for a NFCU secured card now or wait?  Again, I have no credit cards of my own but we have been banking with NFCU for the past year or so.  My wife's credit is also abysmal so I'll be trying to tackle what I can with that at the same time, though she has a foreclosure showing for the next few years so the house we purchase will solely be in my name.

 

Again, mistakes were made, I've learned from it and trying to get past this.  Does this seem like a reasonable plan?  Thanks in advance.


I would pull all 3 of your CRs for free (no scores and free to do weekly through 4/2021) from Annual Credit Report. I found that some accounts are not listed on all 3, so only having 1 report might be giving you only part of the story.

 

It is not that surprising to have a higher mortgage score. I am not sure why, but it happens. My EQ8 was 604 and EQ5 (mortgage score) was 671. Different scores look at different things. They go off of your middle mortgage score, and it might be that is the 520 score. They don't take the highest or lowest score and they need all 3. That is why when you are really ready (credit wise) to buy, to definitely dobab3B pull from myFico because they have all 3 mortgage scores.

 

For a mortgage app, the UW is going to want all baddies paid. I would honestly not bother with the lortgage process until this stuff is fixed up.

 

Since you are looking to buy a house PIF "looks" better because if you settle then there is usually the remark "paid less than full balance". As @FiresOut said, once you are done dealing with the COs, then tackle the CAs, as the COs may guve you some more points than paying the CAs. When you do tackle the CAs, PFD is the best way to go so they are simply completely off your CRs.

 

And I also agree you absolutely need off that AU CC. It is killing you also because not only is it maxxed out, it is over the credit limit (as mentioned above). Once you are off the account, the TL will be removed from your CRs.

 

Also, having no revolving credit of your own is also hurting you. While you have an AU account, so did my SO, and he still got the negative feedback stating he had no revolving credit. I know they say you should not app for credit within a year of a mortgage app, but I still think it might be a good idea once you have cleaned up these old baddies to get a CC. Just my opinion.

 

Good luck!




Starting Score: 2•20 | EQ 550 | TU 498 | EX 505
Current Score: 4•21 | EQ [F8 651] [F9 645] [EQ5 678] [VS3 630] | TU [F8 716] [F9 684] [TU4 721] [VS3 639] | EX [F8 640] [F9 651] [EX2 655] [VS3 627]
Goal Score: 670 [X] TU


Take the myFICO Fitness Challenge

SO Starting Score: 2•20 | EQ 502 | TU 484 | EX 521
SO Current Score: 4•21 | EQ [F8 619] [F9 659] [EQ5 657] [VS3 627] | TU [F8 675] [F9 659] [TU4 644] [VS3 625] [VS4 678] | EX [F8 631] [F9 664] [EX2 633] [VS3 599]
Goal Score: 670 [X] TU


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Message 3 of 5
cyrusvalentino
Frequent Contributor

Re: Rebuilding...Again

First and foremost it is a road to recovery but one that you can do by yourself. There is no quick fix, and there are a lot of knowledgable people here that will assist. I agree with the @LaHossBoss you will not really see an increase until you have a credit card in your name. Maybe try to obtain a secured credit card from your bank or credit union? Now to tackle your list of negatives and what I've done or seen others do with similar negatives.

 

Negatives:

  • Capital One Charge-Off $353 balance

- You must pay in full if you plan to apply for a mortgage this chargeoff, but ask when you do if they will PFD. Who is the CO account with? What CA? Need more info to advise on if others have had success with PFD.

 

  • Merrick Charge-Off $964 balance

- The Merrick "Law Firm" that will reach out to you is very similar to an in house company. They do not report to a CA, they instead just update the balance on the OC reporting to show payment arrangement in place and will update balance to $0. Yet again, you must pay in full if you plan to apply for a mortgage in the near future.

 

  • Mission Lane/LendUp Chare-Off $646

- Don't know this lender, but who is the CO with? What CO? Same as above applied in reference to paying in full.

 

  • EOS-CCA Collection $814(going to attempt a PFD on this tomorrow)

- Hopefully this will work, you can also search the forum for others who have either gotten or been denied PFD with this CA to determine your chances of success. But you won't know until you ask as policies do change. But becareful settling because to get a mortgage anytime in near future all CO's or CA's must show paid in full.

 

  • South Jersey FCU Chargeoff from 2015 that's still reporting $3,356 balance

- This is likely way outside of SOL as such they likely would accept a settlement. But who is the CO with? Who's the CA? Also yet again you must pay in full versus settlement if you plan to apply for a mortgage anytime in the near future.

 

  • Consumer Portfolio Services, Voluntary Repo in 2017 $15,000 balance

- Contact the OC, and ask for a copy of the final documentation they should be able to provide it or the CA can so that you can feel justified paying the full balance if necessary. This also depending on when in 2017 may also be outside of SOL which is why it has been placed with the CA. This also would have to be resolved to be able to qualify for a mortgage.



Starting Score (05/14/2020):

Current Score (07/01/2020):

Goal Score (01/01/2021):

Other Stats:

Message 4 of 5
Scff506
Established Member

Re: Rebuilding...Again

So far all of the accounts listed are still with the original creditor. The only collection I currently have showing on all 3 reports are EOS and Affirm. Tons of good information here. Thank you all for the replies. Going to work on these suggestions starting tomorrow. 

Message 5 of 5
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