Means to reach an optimal score in 12 months question

[Anonymous]

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@NRB525 wrote:

The advantage of pulling the reports now is that you put a specific number on what your mortgage score really is.

That takes out the "wonder" aspect. It also gives you a solid understanding of where you are, so you can measure progress in the future.

A mortgage is a major financial transaction. The 3B reports do cost some money today, but all good information is not free.

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Excellent point NRB.   I'll off to pull.    Thanks for your wisdom.

[StartingOver10]

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@NRB525 wrote:

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@StartingOver10 wrote:

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Couple of points:

• Make sure your judgment Satisfaction is recorded in the actual public records.  If you don't record it, the judgment is still in full force and effect. You should be able to get the judgment removed from your credit report by sending in a copy of the recorded satisfaction to the CRB.
• You can use your cards as long as you aren't building up debt.  About 60 to 90 days before you plan to apply for a mortgage pay off all balances except one and have that balance show as less than 9% (not 10%) of the individual credit card limit to optimize your score.  The calculation of your utilization is continuous - each time you pull your report/score and the scoring algorium has no memory of previous utilization calculations on your CR. 
• Read more in depth about bucketing. I don't know enough about this area to give you information.  I thought as long as you had any derog on your report you were in a "dirty" bucket.  But don't take my word on it - others here know more about it than I do. 

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I would rephrase this one as "Utilization is point in time". There is no tracking of utilization percentages over a continuous sequence of time, it's just "what is utilization right now, today".

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^^Yes, you are right - point taken. 'Utilitazation is a point is time' is a much more accurate phrase. Thanks.

[SouthJamaica]

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@Anonymous wrote:

Hi,  question for the score buffs:

I'm rebuilding, trashed credit in 2009/10.  I have student loan lates from 2011.  Otherwise no collections, one charge off DOFD 11/2009.  One satisfied judgement for $1500 vacated, but still showing on EQ, from 2013.   One old paid mortgage, house sold in 2011.

Cards:  Cap 1 QS 18 mos old, a second cap1 4 months old, store card 4 months and 2 recent cards from Feb 2016 (discover and local CU)   Currently 4 are reporting small balances, but this changes weekly.    I am paying them all in full, but at times, they will be charged up to 50 percent of their limits. 

I would like to buy a house in 12-18 months.

I understand the concept of having all cards except one report at zero, and one at less than 10 percent.     I have heard that this tweaking is not necessary until just prior to a mortgage app, is this correct?   

Alternatively, I read on a thread here, that fico will Bucket users that have balances on many cards, and with over 10 percent of credit limit used.   So, if this is true, I should constantly trying to keep my balances low?  And with only one card reporting?

This is tricky for me, because my limits are so low on my cards.   Also, because I would like to USE my new cards, and not worry about reporting dates for now (so I can demonstrate use for future CLI and unsecuring of Discover etc).

Just wondering what the best method would be for using my cards in the next 8 - 12 months.    If the bucketing threat is real, I will pay more attention to statement reporting and be more conservative with use.

Thanks in advance!

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If you want to optimize your score in 12 months, you should use the cards sparingly, let most of them report at zero, the other(s) at 9% or less.

And not do anything that would trigger a hard pull.

[Revelate]

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@NRB525 wrote:

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@Anonymous wrote:

Look after that judgement as others have said.  Should help.

On the # cards - it's not a bad idea to be aware of the reporting dates so you get in the habit of making a concious decision whether to show a balance or not.

Run a trial where you let all but one report 0 for a month, just so you see what effect it really has on your score.  Then let balances report (or not) and see how your score is affected as each hits.  That will give you an idea of how much your score may increase when you optimize for the mortgage pulls.

Otherwise I wouldn't worry about keeping them all optimal until you get three months out from your mortgage shopping.

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Keep in mind that the "easy to find" FICO 08 scores are on a different set of criteria from the Mortgage models. One may not see much movement on a FICO 08 Bankcard score, with most or all cards reporting (I let all cards report whatever they will) but the Mortgage scores are likely more significantly affected by most/all cards reporting. This only becomes a factor when the OP applies for a mortgage, but it will only be possible to guage where the OP is in Mortgage scoring by getting the 3B report that includes those specific Mortgage scores.

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1 card reporting is optimal for everyone (sure some people can have more balances reporting on a thicker file but that's besides the point) on every single non-industry option model since at least FICO 98.  The advice is fine.

@OP: Specific to mortgage, and specific to EX Risk Model v2 which is the Experian portion of the mortgage trifecta, consider getting a small share secured loan from someone like Alliant (who we all know and love for this, 5 year term, and make sure to turn off the autopay) and then pay it down to some minimal balance like $20 after it first reports and let it hang out through your mortgage paying a small bit every 6 months or so to keep inactivity fees away.

This score does react positively (it will do nothing for either the EQ or TU scores unfortunately but every little bit helps), and in my case it kicked me up a tier when it came to mortgage UW (hit 720 instead of 700 on my mid score) so if you're playing below the top tier and you're trying to optimize 12+ months out, go pick one up as from what I read you don't have any current installment loans open.  If you do have an unlisted account (car loan or what not) then ignore this.