very disappointed

[Anonymous]

I just received my 3 updated reports, it's been 3 month so I looked at my updated reports. I want to start by saying I had a chapter 7 BK discharged 2 years ago and i cleaned everything off my reports, other than the BK. I have zero baddies on my reports, no late payments nothing. I have 7 charge cards 7% uti, im carrying a balance on two cards.it's a low balance no where close to my limit. I know carrying a balance on only one card may help a little. After the BK my scores were 400-450 range.  I want to buy a house in June or July of this year. My fico8 scores are ok there  EQ 675  TU 707  EX 700, but where my fustration and disapointment lies is in my Fico scores used for a mortgage.  EQ 656  TU 698 EX 663. I really want to hit 680 for a middle score they tell me this is the minimum score for electronic under writing and a decent mortgage rate. MY average credit account age is to low at 11 months, so hopefuly time will help this a little. I guess my question is what the heck can i do to get my mortgage scores up? I dont have mortgage loan past or present reporting on my credit reports. I have a 10 month old car loan always on time and a 16 month snapon tools loan always paid on time. 

[Chris679]

What reasons does FICO gives for bringing down your score?  

Can you pay down the balances on the loans? Personally I have seen my scores go up as I paid down installment loans until they were about 1/3 paid off. 

Having a balance report on only one card may help.  

[Thomas_Thumb]

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@Anonymous wrote:

I just received my 3 updated reports, it's been 3 month so I looked at my updated reports. I want to start by saying I had a chapter 7 BK discharged 2 years ago and i cleaned everything off my reports, other than the BK. I have zero baddies on my reports, no late payments nothing. I have 7 charge cards 7% uti, im carrying a balance on two cards.it's a low balance no where close to my limit. I know carrying a balance on only one card may help a little. After the BK my scores were 400-450 range.  I want to buy a house in June or July of this year. My fico8 scores are ok there  EQ 675  TU 707  EX 700, but where my fustration and disapointment lies is in my Fico scores used for a mortgage.  EQ 656  TU 698 EX 663. I really want to hit 680 for a middle score they tell me this is the minimum score for electronic under writing and a decent mortgage rate. MY average credit account age is to low at 11 months, so hopefuly time will help this a little. I guess my question is what the heck can i do to get my mortgage scores up? I dont have mortgage loan past or present reporting on my credit reports. I have a 10 month old car loan always on time and a 16 month snapon tools loan always paid on time. 

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Fico mortgage scores are more sensitive to # of cards reporting a non zero balance than is Fico 08. Also, impact may be greater if the balance is on freshly minted cards. Key point is reporting a balance, not necessarity carrying a balance. 

If you allow charges to report on monthly statement and then PIF the statement amount, you are not carrying a balance. However, the statement amount gets reported to the CRAs. So, if you have multiple cards that report a non zero balance, your score will get dinged. Allowing 4 cards to report a non zero balance (as opposed to one) could be costing you 15 to 20 points on Fico Mortgage scores (particularly EQ - IMO).

A couple other things to consider:

1) Although maintainind aggregate CC utilization is considered optinal, there may be a few points to be gained by reducing it to under 6% (see if getting down to 4.5% helps). Also, try to keep any reported balance under 20% of the card's limit.

2) total balance to loan ratio on open installment loans is a scoring Factor in Fico 98 mortgage used by Experian. I believe there may be a threshold at 70%. If you are close to 70%, pay one or both down to get aggregate under 70%.

Beyong the above, it's all about allowing accounts to age and getting the BK to drop off over time or be removed.