Increase my credit score from 711 to 720+

[Anonymous]

Hello - I'm in the process of buying a second home which will become my primary residence.  My salary is ~150k/year.  My first mortgage will remain on my credit because that is where my parents will continue to live.  I will be moving to the new home with my child so that we can all live separately - and peacefully!

The home is a new construction which will be ready in 5 months.  I already have the sales contract so I'm on the hook.  I was told by the mortgage lender that my FICO Mortgage score is 711.  I have read that a score of 720 gets significantly better rates.  I've already read the Frequently Request Threads post on this forum and have started working on some issues.  Since this is my first time trying to improve my FICO scores, I could really use some help.  

1. I cannot do BT to my $0 balance cards.  So, when deciding to pay down my credit cards, should I pay off the higher utilizations?  Pay off the smaller balances?  I included my account balances at the bottom of this post.
2. Is a report of 3 late payments 12 months ago affecting me greatly? The CCC denied my petition to erase the bad marks over the phone today, should I try a letter?  Or should I try to hire a credit repair company to help me remove that?
3. I just realized that an account I opened 19 years ago was closed just last June 2018.  Is it possible to ask the bank to reopen it?  Or is that a lost cause?  

THANK YOU so much in advance for any help and feedback you can give me! Best regards!

This is my current snapshot:

Overall Credit Use: 30%

Payment History: 100%

Derrogatory Marks: TU = 0, EQ/EX: 1 account

Credit Age: 5 yrs 7 Mos

Total Accounts: 29

Hard Inquiries: 5 Total:  2 in 2018 and 1 in 2017 and 2 in 2016

These are my accounts:

Auto Loans

• Auto Loan #1 in Good standing – Owe $20.8k – Paid 37% of original amount
• Auto Loan #2 in Good standing – Owe $22.1k – Paid 8% of original amount
• 2 Auto Loans, paid off in 2008 and 2014, in Good standing

Mortgage

• 1 Mortgage in Good standing – Owe $73.3k – Paid 29% of the real estate loan amount

Credit Cards

• 7 Open credit cards in Good standing:
  • CC #1 - As of 07/28/18: Bal: $14,527 / $14,500 - Used: 100% -  Interest: 0%
    • As of 8/23/18: Bal $10,582 / $14,500 – Used 73%
  • CC #2 - As of 08/12/18: Bal: $16,447 / $26,000 - Used: 63% -  Interest: 21.24%
  • CC #3 - As of 08/22/18: Bal: $4,439 / $9,500 - Used: 47% -  Interest: 10.49%
  • CC #4 - As of 08/15/18: Bal: $6,107 / $23,000 - Used: 27% -  Interest: 18.24%
  • CC #5 - As of 07/28/18: Bal: $2,086 / $12,250 - Used: 17% -  Interest: 0%
    • As of 8/23/18: Bal $950 / $12,250 – Used 8%
  • CC #6 - As of 08/20/18: Bal: $800 / $5,000 - Used: 16% -  Interest: 0%
  • CC #7 - As of 08/12/18: Bal: $189 / $4,000 - Used: 5% -  Interest: 26.74%
    • Paid it off 8/23/18
• 5 Open credit cards in Good standing with $0 Balance which are primarily retail and/or do not offer balance transfers
• 1 Closed Credit Card with a bad mark (Toyota Rewards) which I mistakenly used and missed paying it off until 4 months too late, so I have a 30, 60 and 90. The charge was for $237 and it grew to $400 after interest and late fees, which I paid off in full back in Aug 2017.  The credit card company reported my account closed and paid in full in March 2018.  I called the credit card today, and they refused to retract/clear the negative marks. 
• 10 Closed Credit Cards in good standing

[Anonymous]

My comments in blue below.

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@Anonymous wrote:

1. I cannot do BT to my $0 balance cards.  So, when deciding to pay down my credit cards, should I pay off the higher utilizations?  Pay off the smaller balances?  I included my account balances at the bottom of this post.

You should work first to lower all cards to under 87%, then to lower all cards to under 67%, then to lower all cards to under 48%.  (This is each card considered by itself individually.)

After that work to pay to zero as many small balance cards as possible.

After that (if you think you have more money to pay down cards) you should pay all cards to under 28% with a total utilization of less than 8.99%.

While you are paying your cards down you should always pay at least $2 more than the minimum payment on every card at all times, even if it is not a card you are working on paying down.

1. Is a report of 3 late payments 12 months ago affecting me greatly? The CCC denied my petition to erase the bad marks over the phone today, should I try a letter?  Or should I try to hire a credit repair company to help me remove that?

If those are your only derogs, they are affecting you very greatly.  Especially since one is a Day 90 late.  I encourage you to investigate the Goodwill Letter Saturation Technique, though I would not try implementing it until all cards were reporting under 67%.

I just realized that an account I opened 19 years ago was closed just last June 2018.  Is it possible to ask the bank to reopen it?  Or is that a lost cause? 

That's a lost cause.

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You describe your scores.  Are these FICO's mortgage scores?  FICO 8 scores?  Some other kind of scores?

[Anonymous]

CGD,

I've seen comments from you, and others, re  "pay $2 more than minimum payment" ...why, especially such a small amount?

[Anonymous]

I hate coming off judgmental and I'm not sure how else to present my opinion here, but I would be extremely cautious about anyone taking on a mortgage when they've got nearing $50k in revolving debt.  With $150k in income, certainly the means are there to pay that, so the fact that it's there suggests poor financial planning/management... basically something that would make me uneasy about recommending a mortgage to someone. 

High utilization is the only thing holding the OP back here from a top score for best rate purposes.  Sure the major baddie present is probably holding you back 60-80 points, but even with that there you could still have 740-760 scores if your utilization was in check.

[Anonymous]

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@Anonymous wrote:

I hate coming off judgmental and I'm not sure how else to present my opinion here, but I would be extremely cautious about anyone taking on a mortgage when they've got nearing $50k in revolving debt.  With $150k in income, certainly the means are there to pay that, so the fact that it's there suggests poor financial planning/management... basically something that would make me uneasy about recommending a mortgage to someone. 

High utilization is the only thing holding the OP back here from a top score for best rate purposes.  Sure the major baddie present is probably holding you back 60-80 points, but even with that there you could still have 740-760 scores if your utilization was in check.

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I don't think you were being judgemental to the OP, BBS. The OP kindly requested sound advice based on their profile, and you provided them with just that. Utilization is always something that can hold one's score back. That's part of the reason AZEO exists.

[Anonymous]

Thank you so much for the suggestions. The plan to reduce revolving accts by percentage brackets feels less overwhelming. I will do more research about the Goodwill Saturation Letter Technique.

I imagine the FICO score I was told I had is the FICO Mortgage because it came from the loan officer. My FICO 8 according to my bank is 741.

Thank you for your suggestions!

[Medic981]

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@Anonymous wrote:

@CreditGuyInDixie

I've seen comments from you, and others, re  "pay $2 more than minimum payment" ...why, especially such a small amount?

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I have been curious as well. I suspect it is to chip away at the principle of the debt and to also help keep the utilization from increasing. I would like to see what @CreditGuyInDixie or one of the more knowledgeable myFICO forum veterans have to say.

[Anonymous]

No offense taken, Brutal.

Highly to blame is poor management and partly to blame is everything else: family situation, expensive medical treatment for a special needs child, etc, etc. Details that probably don't belong here. Despite all that, the fact remains that we need to move out and renting makes less sense. To the extent that I can get a better interest rate, the more likely we are to get out of the hole in many aspects.

I have always paid everything on time, but not always in full. Until now, I had never spent the time to understand credit scores. But I figure if I shopped around for homes, I need to have the upper hand as I do a little shopping around for mortgage lenders and interest rates. That is what led me to this forum and the desire to learn to manage my finances better while I improve other mu situations.

Thanks for your feedback!

[Anonymous]

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@Anonymous
I have always paid everything on time, but not always in full.

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From your original post, it sounds like you had an account that ended up with a 90 day late.  You should do everything you can (GW Saturation Technique) to get that 90 day removed.  Since it's your only negative item and it's a major one, you'd see 60-80 point score increases. 

[Anonymous]

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@Medic981

I have been curious as well. I suspect it is to chip away at the principle of the debt and to also help keep the utilization from increasing. I would like to see what @CreditGuyInDixie or one of the more knowledgeable myFICO forum veterans have to say.

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I don't think it really has to do with chipping away at principal, as $2 extra really isn't going to accomplish that.  I think the point here however is that you're showing the lender that your desire is to pay more than the minimum, something that makes them feel more comfortable than just the minimum, which many people do.  It comes down to the principle here rather than the principal, I believe