@Anonymous wrote:
@stinastinaSo what do you suggest I chip at first ? I can't get everything down to 26% immediately; I just don't make that kind of money. I think by the end of October I could get the highest cards down to 66% but I wouldn't be able to get any others to 0. If I had every card that has a balance right now that is over 69% down to 66%, do you think I could get some points ?
While you didn't come out and say it in your first post, I would assume that your concern over your mortgage scores is that you're considering a mortgage in the near future. While it may not be exactly what you want to hear, I'd suggest putting that off for a bit. If you are struggling to pay off revolving debt now, the last thing I would suggest doing is adding a mortgage to your plate. Not only would you be in a better financial place if you took care of the revolving debt first, but you'd also possess the credit scores that are far better allowing you to obtain a way better mortgage interest rate. That rate difference could mean the difference in tens of thousands of dollars of interest savings over the life of the loan. Just something worthy of consideration here, IMO.
I've already submitted my loan application to the USDA Direct program. I believe payment shock is what is causing me to be denied. What I read in their guidelines is that payment shock can be waived if my score is 680. However, after just looking at their guideline book again, it does say "Multiple layers of risk may be justified if the applicant has an excellent credit history reflecting timely repayment of credit obligations or a reliable credit score of 640 or higher on their TMCR." So I may be fine to continue but I have to confirm with my rep.
Why would you charactize this as "struggling to pay off revolving debt" ? I think I've done pretty well the past two months considering my low income. I pay all my bills on time.
@DollyLama wrote:
@stinastina wrote:
@Anonymous wrote:Mortgage scores are more sensitive to number of accounts with balances, so paying off some of your smaller balance cards in order to allow more $0 balance accounts to report would be helpful. You're currently at 60% or so of your accounts with a balance, which is very high.
Also, as mentioned already above, your utilization is what's killing you... both your highest individual card utilization and your aggregate utilization. While I didn't add up all of your accounts/balances, it looks like you might be around 50%-55% aggregate utilization, meaning you've taken 3 scoring penalties for the thresholds crossed (8.9%, 28.9%, 48.9%) to get to that point. It seems your highest individual balance card has you at about 87% utilization, so that's another scoring penalty there. Paying your balances down will give you significant score improvement.
A couple of months ago I had more balances on all cards so I paid off the smaller cards to zero - Overstock, Walmart, Firestone, Penfed CLOC. Then I did a balance transfer with Care Credit to my Navy card because the monthly payment was crazy. But my score did not change much. When I made my payment to my highest card this month, my goal was to get it to 86% but I failed because the interest charges were higher than what I anticipated.
So what do you suggest I chip at first ? I can't get everything down to 26% immediately; I just don't make that kind of money. I think by the end of October I could get the highest cards down to 66% but I wouldn't be able to get any others to 0. If I had every card that has a balance right now that is over 69% down to 66%, do you think I could get some points ?
You probably did not see much of a score change, as when you were snowballing the smaller balances, you BT the Care Credit to Navy, raising that one card's utilization higher.
Is the $2k month what you pay on the accounts or total everything, utilities, auto insurance, etc?
IMHO, I'd get the 3 lowest (under $1k accounts with exception of the SSL)down to zero, then chip down on the Navy to less than 48.9%, once it reaches that threshold, chip away the rest, one by one to same thresholds, once all those thresholds are reached, shoot for less than 28.9% on all cards remaining. No apping for any new cards, let any inquiries age off, and if your youngest account is under 1 year of age, let it age to 12-13 months minimum.
The Navy Amex just reported this month, so no, that was not the case. I was kind of surprised I didn't see any significant change. My scores are similar to six months ago.
So you don't think it's more important to get below 69% first ? I have 3 accounts that are less than $1k. $2 is everything.
@stinastina wrote:Hello, I need some help figuring out how to get my mortgage scores up to 680 (I believe I need at least 2 at 680 or higher). I don't know what they are but I do know my Fico 8s. Will the Fico Ultimate 3b plan give me the mortgage scores from all 3 bureaus ? I see it will only update all 3 bureaus quarterly. How would I get a monthly update ?
Here is my profile:
Ch 7 discharged 1/16
No collections since then
No lates since then
Fingerhut reporting as included in BK (No other accounts report at all that were included in BK)
Credit cards:
Overstock - limit is $300 and balance is 0
Target - limit is $300 and balance is $277 (I just paid this off but missed the statement cut off date)
Navy Flagship - limit is $6k and balance is $5241
Navy Amex - limit is $15k and balance is $10486
Samsung - limit is $1200 and balance is 0
Barclays - limit is $1500 and balance is $453
Care Credit - limit is $6000 and balance is 0
Walmart - limit is $300 and balance is 0
Discover - limit is $3500 and balance is $2532 (It's possible I could get a cli in October)
Navy Secure Share Loan - limit is $250 and balance is $21
Navy Checking LOC - limit is $5k and balance is $3407
Penfed Promise - limit is $1500 and balance is $703
Penfed Checking LOC - limit is $500 and balance is $123
Firestone - limit is $1200 and balance is 0
Jewelry Acct - limit is $5000 and balance is 0
Student Loans:
US Dept of Ed - total is $83815 and balance is $83815 (Income based repayment at 0 per month)
My income is about $2000 a month - for October I expect about $2500 and November $2000.
Current Fico 8s:
EX - 664
EQ - 652
TU - 645
Try to get all revolving accounts to 28% or less, and overall revolving utilization to 9% or less, and try to have most accounts reporting zero balance.
@Anonymous wrote:
@stinastinaWhy would you charactize this as "struggling to pay off revolving debt" ? I think I've done pretty well the past two months considering my low income. I pay all my bills on time.
While I didn't do the exact math, it looked to me like you had around $25k in revolving debt. Is that accurate? By your own admission, your income is low. That being said, trying to tackle $25k in revolving debt on a low income on it's own is a big challenge, but now you're talking about adding a mortgage into the mix. Paying your bills on time is not the same as paying off your debt. Someone can pay their bills on time for 10 years non-stop and still be at the same point in terms of debt dollars at Year 10 that they were in Year 1. Any time someone has any level of revolving debt that they couldn't pay off in cash today if they wanted to it makes me very uneasy when I hear about them taking on additional debt. It's just a concern, that's all. Ultimately my opinion doesn't matter one bit, as what you do is completely in your hands.
Paying off all my debt is not my goal at the moment. As I stated, I would like suggestions on how to get to at least 680 with my current situation. You have gotten off topic and sound a little judgmental.
Your initial suggestion to tackle the accounts with the highest utilization first sounds reasonable to me. However, someone else suggested I pay off the smaller accounts first. So now I am not sure which is the best route to go with my next paycheck.
@SouthJamaica wrote:
@stinastina wrote:Hello, I need some help figuring out how to get my mortgage scores up to 680 (I believe I need at least 2 at 680 or higher). I don't know what they are but I do know my Fico 8s. Will the Fico Ultimate 3b plan give me the mortgage scores from all 3 bureaus ? I see it will only update all 3 bureaus quarterly. How would I get a monthly update ?
Here is my profile:
Ch 7 discharged 1/16
No collections since then
No lates since then
Fingerhut reporting as included in BK (No other accounts report at all that were included in BK)
Credit cards:
Overstock - limit is $300 and balance is 0
Target - limit is $300 and balance is $277 (I just paid this off but missed the statement cut off date)
Navy Flagship - limit is $6k and balance is $5241
Navy Amex - limit is $15k and balance is $10486
Samsung - limit is $1200 and balance is 0
Barclays - limit is $1500 and balance is $453
Care Credit - limit is $6000 and balance is 0
Walmart - limit is $300 and balance is 0
Discover - limit is $3500 and balance is $2532 (It's possible I could get a cli in October)
Navy Secure Share Loan - limit is $250 and balance is $21
Navy Checking LOC - limit is $5k and balance is $3407
Penfed Promise - limit is $1500 and balance is $703
Penfed Checking LOC - limit is $500 and balance is $123
Firestone - limit is $1200 and balance is 0
Jewelry Acct - limit is $5000 and balance is 0
Student Loans:
US Dept of Ed - total is $83815 and balance is $83815 (Income based repayment at 0 per month)
My income is about $2000 a month - for October I expect about $2500 and November $2000.
Current Fico 8s:
EX - 664
EQ - 652
TU - 645
Try to get all revolving accounts to 28% or less, and overall revolving utilization to 9% or less, and try to have most accounts reporting zero balance.
While I agree that getting util down is ideal, I am asking for specific suggestions on what to do right now with my situation. One suggestion was to pay off the smaller accounts first. The other was to pay down the account with highest utilization first to the next threshold. So which of those two suggestions would you start with ?
@Anonymous wrote:
I would put off home buying until more of your debt was paid down. But that's just my personal opinion.
However, if you choose to go forward, then getting your individual utilization under 28% is going to give you the score bump you are looking for.
As I asked another poster, I will ask you as well,
While I agree that getting util down is ideal, I am asking for specific suggestions on what to do right now with my situation. One suggestion was to pay off the smaller accounts first. The other was to pay down the account with highest utilization first to the next threshold. So which of those two suggestions would you start with ?
They're not mutually exclusive. As has been stated earlier, you get a score ding when you pass certain thresholds. The biggest is when your aggregate utilization goes over 28.9%. Getting all of your cards below that will give you the biggest bump. The reason for recommending below 28% is to create a buffer if interest posts. Besides overall utilization, you're also dinged due to the card with the highest balance. It doesn't matter if all of your other cards are at 0% if one of them is higher than 28.9%, you receive a penalty. So, pay all your balances below 28% to get the highest boost without going to AZEO. Which goes back to my original recommendation of not bothering with monitoring scores until you get close to that.
