Credit Scores, Collections, and Debt

There are so many different platforms and portals where you can get your credit scores, and every portal has a different credit score for each individual consumer. I am mainly interested in what credit scoring platform mortgage lenders use? Mortgage companies pull a tri-merger credit report, which is they pull a report on Equifax, Experian, and Transunion and use the middle credit score. If a mortgage loan borrower wants to see what his mortgage credit score is without going to a mortgage broker or mortgage lender, which credit scoring platform should they use? Credit Karma, Credit Sesame, Experian, MyFICO, Smart Credit, Credit Wise, all have different algorithms it seems like because every one of those credit reporting and scoring companies yields a different credit score for each individual consumer. For Example, Credit Karma yields a 530-credit score on Transunion for me and Experian.com yields a 642-credit score on Transunion. Why such a large difference? What Credit Scoring Model Do Mortgage Lenders Use.

Credit Play an important role in the mortgage process

Any new loan officer or veteran loan officer who has not been trained on the fundamentals and types of credit reports and analyzing credit reports may find this thread very helpful and hopefully avoid making avoidable mistakes.

Please start by reading this informative guide;

https://gustancho.com/credit-during-the-mortgage-process/

• This discussion was modified 3 months ago by  Gustan Cho.

gustancho.com

Credit During the Mortgage Process Made Simple

Credit during the mortgage process requires borrowers to meet minimum credit score. Lenders will look at payment history in the past 12 months.

Can a credit repair and mortgage loan originator export advice on the best and fastest way to establish your credit and increase your credit scores to qualify and get approved for a mortgage loan? Can you please go over the most common types of case scenarios borrowers with bad credit have and a step by step process on reestablishing your credit and boosting your credit scores? Mortgage Professionals run into various types of cases such as borrowers with outstanding collections and charged off accounts, borrowers without any credit trade tradelines, borrowers with just collections, charge offs, old derogatory credit tradelines that are closed, borrowers with late payments, borrowers who only have one or two credit scores and not a third credit score from the credit bureaus, borrowers with no credit scores, and borrowers who just cannot get an approve – eligible per automated underwriting system. Also Gustan Cho Associates recommends to rebuild, reestablish, and boost your credit scores by getting new credit such as secured credit cards, EXPERIAN BOOST, KICK OFF, UPSTART, CASH NET, NET CREDIT, and other credit rebuilder programs? What type of credit and creditors do you ecommend dnd advise i get? A structured step by step overview of your credit rebuild and reestablish advise would be extremely appreciated and forever grateful 🙏. Thank you

https://gustancho.com/boost-your-credit-with-new-credit/

gustancho.com

Boost Your Credit With New Credit To Qualify For A Mortgage

Boost your credit with new credit to qualify for a mortgage . New secured credit cards and credit builder loans increases credit scores for mortgage

You do not need perfect credit or high credit scores to qualify for a mortgage loan. Every loan program require a minimum credit score. Besides HUD, VA, USDA, FANNIE MAE, FREDDIE MAC, or non-QM portfolio lenders requiring a minimum credit score, each lender can impose lender overlays on credit scores. Lender overlays are additional credit score requirements above and beyond the minimum agency mortgage guidelines imposed by each individual mortgage lender. Regardless of the minimum credit scores required, all lenders will normally want to see timely payment history in the past 12 months. Regardless of the prior bad credit you have, having timely payment on all of your monthly debt payments that report on the three credit reports is crucial. Do not worry about prior collections, charge-off accounts, late payments, or other derogatory credit tradelines unless you are going though a manual underwrite on FHA loans. HUD manual underwriting guidelines require timely payments in the past 24 months. VA manual underwriting guidelines require timely payments in the past 12 months. In many instances when you get an approve/eligible per automated underwriting system but late payments in the past 24 months, the lender may down grade your file to a manual underwrite. The best solution for you to increase your credit scores and strenghen your credit profile with recent late payments is adding positive credit with new credit. Please read this guide on how to boost your credit to get approved for a mortgage: Capital One Secured Credit Card will get you a $250 secured credit card with a $50 deposit. Self.Inc is a bank that has a phenomenal credit rebuilder program where you can make a monthly deposit as small as $25.00 per month. That monthly deposit goes towards a savings account but it reports as an installment loan to all three credit bureaus. Get a Discover secured card. Secured credit cards are the same as unsecured traditional credit card. The only difference is you need to put a deposit. The amount of deposit is the amount of credit you get by the credit card company. You need to make timely minimum monthly payments on your secured credit cards. Just start with these three creditors and you will see wonders in the weeks and months ahead. I will cover some quick fixes for you to increase your credit scores fast and at the end of this topic thread, I will list helpful resources on boosting your credit to qualify for a mortgage, how to reach a human at the credit bureaus, and how to rebuild your credit:

1. Capital One Secured Credit Card

2. Self.Inc

3. Discover Secured Credit Card

As time pass and you make timely payments, your secured credit card company will increase your credit limit without asking your to put additional deposit. If you can get more secured credit cards, it will expedite your credit rebuilding process. However, you should at least start with the above three creditors.

Improving your credit scores and rebuilding credit can be crucial when seeking mortgage approval. Here are some effective strategies to consider:

Review your credit reports: Obtain copies of your credit reports from the three major credit bureaus (Experian, Equifax, and TransUnion. Identify and dispute any errors or inaccuracies that may be negatively impacting your credit scores.

Pay bills on time: Payment history is the most significant factor affecting your credit scores. Make sure to pay all your bills (credit cards, loans, utilities, etc.) on time, every time. Set up automatic payments or payment reminders if necessary.

Reduce credit card balances: High credit card balances can hurt your credit utilization ratio, which accounts for a significant portion of your credit scores.

Aim to keep your credit card balances below 30% of your total available credit limit. Consider paying off credit cards with the highest balances first.

Don’t close unused credit cards: Closing credit cards can inadvertently increase your credit utilization ratio and decrease your overall available credit. Keep unused credit cards open, but avoid using them to maintain a low credit utilization ratio.

Increase credit limit: Request a credit limit increase from your credit card issuers, which can improve your credit utilization ratio. Be sure to handle the increased credit limit responsibly and avoid overspending.

Limit new credit applications: Each credit application results in a hard inquiry on your credit report, which can temporarily lower your credit scores. Limit credit applications only to when absolutely necessary.

Use different types of credit: Having a mix of different types of credit (e.g., credit cards, auto loans, personal loans) can positively impact your credit scores. Consider taking out a small loan or opening a new credit card account if you have limited credit types.

Monitor your credit regularly: Check your credit reports and scores periodically to ensure accuracy and track your progress. Consider signing up for a credit monitoring service to receive alerts for any changes to your credit profile.

Be patient and consistent: Rebuilding credit takes time and consistent effort. Stick to responsible credit habits, and your credit scores should gradually improve, increasing your chances of mortgage approval.

Remember, lenders evaluate various factors beyond just credit scores when considering mortgage applications. However, improving your credit scores and maintaining a healthy credit profile can significantly increase your chances of getting approved for a mortgage with favorable terms.

https://gustancho.com/boost-your-credit-with-new-credit/

gustancho.com

Boost Your Credit With New Credit To Qualify For A Mortgage

Boost your credit with new credit to qualify for a mortgage . New secured credit cards and credit builder loans increases credit scores for mortgage

Are there any FICO SIMULATOR plugins for my website and also WHAT IS MY HOUSE WORTH plugin?

If yes, what is the process for them?

Good evening ✨

I am looking for a reputable company selling trade lines, so that I can recommend them to a current client of mine.

Thank you all so much for any pointers!

Best Regards,

-Janna

How to calculate your credit card utilization.

Balance Owed ÷ Credit Limit × 100 = %

2 IMPORTANT DATES (Due Date & Statement Date)

Due Date-The date it MUST be paid to avoid any late fees.

Statement Date-This is the date they will REPORT to the credit bureaus. Why is this date so important?! Whatever balance is reported on this date is what they will report to the credit bureaus. Make sure your balances are LOW (3%-8%) about three days before the statement date. Remember, statements dates can change because they are on a cycle (29 day, 30 day etc. ). Be sure to check your statement for your current statement date

Are there any reputable credit repair companies anyone at GCA FORUMS can recommend? I am a licensed real estate agent in Illinois, Wisconsin, Indiana, Tennessee, and Kentucky and represent homebuyers of residential and commercial properties. However, many of my clients are in need of a credit repair consultant to rebuild, re-establish, and boost their credit scores during times of high mortgage rates and lenders requiring higher credit standards. I have spoken to Felix Nicolas and he said that Gustan Cho was working on vetting a few reputable national credit repair companies and he will be making an announcement on the GCA FORUMS sometime this week. We are in desperate need of a credit repair consultant to help hard working homebuyers and investment property investors. Thank you in advance.

The link below is for our Basic Credit Bootcamp. This is a short, very basic overview of credit. It is a great refresher and has some great tips included throughout the video. ENJOY and we hope you find something of value! If you have any questions, please feel free to reach out

http://www.thecreditcouple.net/bootcamp

thecreditcouple.net

Basic Credit Bootcamp

Basic Credit Bootcamp

Can you please tell me what a charge off account on a credit card means? I don’t have to pay this debt?

I am paying off all my credit card debt in the next few days and was wondering if anyone knows how long that will take to reflect on my credit scores? I used the FICO simulator, and according to my existing revolving debt ($5400) and current FICO score (658), if I pay it all off, it would change my score to 718-738.
I want to buy a college graduation present for myself and would like to walk in the door in the best possible position.
Has anyone any advice or information to share?

Who here has been through a credit union to get auto financing? How long had you been a member of the credit union before you got your car loan through them? I’ve heard that sometimes credit unions are easier to get a loan through and have better APR’s, so I’ve been thinking about opening an account maybe and trying that route.

Can anyone on the boards tell me how much will ones credit score take a dive due to a auto repossession? Just curious to know. Will it be hard to get another auto loan after that.

Is there really a 4th reporting credit agency?

I’m thinking about buying a house, I wanna check my credit score online. What is a reliable place to check it? Do you guys have any free tools online?

I have a client wondering whether it makes more sense to just allow her house to foreclose or try to do a short sale.
Her financial advisor advised her she should let it go to foreclosure because if she opts for a short sale, she’ll get a 1099 for the difference between what she owes and what the bank ends up selling the property for. AND of course, she’ll have to pay taxes on that 1099 income.
I’m a Realtor and my thoughts are she should do a short pay because if she goes to foreclosure, she’ll be responsible for that difference PLUS costs which will amount to much more than paying taxes (Plus you can always strike a deal with the IRS for a payment plan without it affecting your credit). The bank that has the deed to her property isn’t going to let her get away free if she forecloses. They’ll come after her for that money with those fees for years, years.
And, with a short pay, the account comes up “settled” in her credit report.

My question: How does one’s credit score differ between a short pay and a foreclosure? Is there a big difference?

Why do we have to leave a little balance on the credit card instead of having a zero balance to get a better credit score? Why do we get better credit scores if we leave a balance on a credit card instead of paying it off at the end of each month?

Should I close out aged credit card accounts?

I had credit scores of 480 on 1/07. I have paid all my collections and have not missed any payments or house payment since 1/07. My score is now 580 and 633. What else can i do, like removing lates for my credit history?

My credit score is high at 705, but my DTI ratio is rather high at 57% how can I get myself a low interest home loan for a first time homebuyer? Any advice would be greatly appreciated.

My associate at GCA Mortgage Group, Wendy Lahn, recommended this  DIY credit repair program. I need to handle some issues with my Discover Credit Card, and I signed up for this DIY credit repair service. I will keep you posted. I will be disputing fraudulent credit card charges. I trust Wendy Lahn’s recommendations and am confident I will benefit greatly.

• This discussion was modified 3 years, 1 month ago by  Gustan Cho. Reason: Updates

How Long Does a Repossession Stay On Your Credit Report?

Many potential home buyers would like to know. They have a car repo and have concerns about getting approved for a mortgage.

• This discussion was modified 3 years, 5 months ago by  Eric Jeanette.

My employer sent me a legal notice through an advocate for not serving the notice period, where I served 30 days instead of 45 days. They asked me to pay 40K as compensation and 20K for legal notice. What should I do?

Should You Cancel Credit Cards Before Applying for a Mortgage?  Is this a good idea? OR, is it better to just pay them down?

Many borrowers are faced with resolving Cairvrs fails in the mortgage process. As of July 2022 the Department of Education restructured the way derogatory debt is handled. Most borrowers had their Caivrs “lifted” and were able to move forward. For those in serious default, they should reach out to the Department of Education and request a payment plan that will go into effect after the forbearance is ended. The representative will request information and may require a fax confirmation of the agreement. Once received and processed, the account will no longer be in default.

This is a marked change from the 9 month rehab programs that were previously required. I assume there will be additional changes as Covid remediation winds down, so borrowers should take advantage of relaxed guidelines now.

• This discussion was modified 3 years, 5 months ago by  Eric Jeanette.

Building credit is an important part of improving your credit. Far too often the borrower does not have sufficient credit to establish history or allow for score growth. It may feel counterintuitive, but having well managed debt can be to your benefit. Prudent credit use shows that you can manage your finances well. Here are some examples of easy to obtain credit building tools –

Credit Builder Card

Self Credit Builder: Build Credit. Build Savings. Build Dreams.

CreditStrong: Get a Credit Builder Loan that Builds Credit and Savings

Experian Boost – Improve Your Credit Scores Instantly for Free

• This discussion was modified 3 years, 5 months ago by  Eric Jeanette.

Who Reports Bankruptcies to the Credit Bureaus?  How and why do bankruptcies show up on the credit report? Why is it that sometimes they do not show up?

Many people use Credit Karma to check their credit scores. However, when they begin working with a lender, they find out their scores are lower.

Is Credit Karma accurate?

• This discussion was modified 3 years, 5 months ago by  Eric Jeanette.