@LynetteM wrote:
I am currently in the process of rebuilding my credit due to prior finance mismanagement and not understanding the impact to my credit. I am trying to raise my credit score to the range of 620+ by April to qualify for a FHA home mortgage loan and the tax credit. My FICO score as of today 2/14/10 is 594. Did you get that here at myFICO? Is it EQ or TU? The EQ you get here should match the trimerge report that will be pulled for a mortgage. The TU score that is for sale to the public (here and at transunioncs.com) is the TU98 score. In your trimerge pull, it will likely be TU04, and we don't have access to that.
I have not had a late payment on any of my accounts for over a year now. I am currently disputing a collection balance on a student loan that I have cleared up, but is still showing on my CR (have a letter from the loan servicing company stating I do not have a collection balance with them). Let me understand. You are disputing that a balance shows...right? Not that you have a collection? If that is the case, a paid or unpaid collection account will score the same. If it is a collection account, have you tried writing a goodwill (GW) letter to get it off your reports?
Would applying for and receiving a secured credit card help or hurt me in this situation? This is impossible to answer without more information. Do you have any credit cards? If so, are any of them bank cards? What is your average age of accounts (AAoA)? How long is your history? How many tradelines do you have on your credit reports? It's good to have a credit card. It's not good to have a brand new one that will lower your AAoA and give you a hard inquiry on your reports. Do you have someone who could add you as an authorized user (AU) to a credit card? If so, ask about the details before you do that.
Please let me know your thoughts or if you have any other suggestions. It's tough to make suggestions without knowing what else may be on your reports. If you have any credit cards, do they have a zero balance? Do you have the money for a down payment? Do you have other debts (car, school loans, etc.)? Have you visited with a mortage loan officer to see what your price range might be, what closing costs might be, etc?
Thank you in advance for your time. There are lots of folks here more than willing to help. Come back with specifics and more questions.
Thank you for the response,
1) I pulled the EQ score here
2) I apologize about the vagueness; I am disputing that I have a collection account, not the balance. I rehabilitated my student loans last year and am current on all of them, so I should not have a collection account on my CR. Should I have written a GW letter instead of disputing?
3) I currently do not have any credit cards. All of the debt that I have are comprised of installment loans. The AAoA is 8 years, my account history is 13 years & 5 months. I currently have 2 active tradelines (vehicle and student loans), all others have been closed. I do have someone that could add me as an AU. I will get the details prior to asking.
4) The only other debt that I have is the monthly rent payment. I have spoken to a LO to discuss what my price range is what the closing costs would be. I am able to cover the closing costs and have enough for the 3.5% down payment (can go up to 5% if needed) required for a FHA loan. I also have a couple months reserves in my savings and a decent amount in my 401(k).
I noticed that my score dropped 8 points today due to the reinvestigation of the student loan collection account. I am assuming (hoping) that it will jump back up when the dispute is complete and it is determined that I do not have a collection account on that tradeline. Is this correct?
Thank you again for your time and please let me know if you need any other specifics.
