-2 EQ FICO change for disputing an item?

Are you sure this was the "only" change? No changes in CC balances or loan balances?

A while back I posted an explanation from FICO on the effect of a disputed tradeline on the FICO scoring, I will try to find it and post as a reply for you. But, 2 points is not a significant change, make sure all the balances are exactly the same between the two reports/scores correlation. Also make sure no "reporting length" is dropping off any of your listed accounts.

 

First of all, it is very risky to dispute a closed TL which is basically perfect except for something FICO cares nothing about--a very old late payment. All too often the result will be a complete deletion of the otherwise positive account. You may have shot yourself in the foot with that dispute, but only time will tell.

Secondly, the slight drop in FICO may be due to the temporary classification of the account as " disputed ". Most FICO models will not use an account in dispute in their calculations, so disputing it took it out of the FICO data, losing age and lowering the score.

 

It is interesting what comprises the majority of the FICO score. Fully 65% of the score consists of two elements. One is the length of time that accounts have been in good standing with no recent problems and what the usage has been.

If one uses the cards a lot he will apparently have a high balance even though he pays it all off every month. Seems that the only way to get around that is to use the cards but pay the balance down several days before the new bill is computed and sent out or simply pay them down and only use them on rare occasions.

Seems like the old saw that says that the only way to get credit is to prove you don't need it fits credit cards too.

 

gman:

It is true they are not used in the calculation, but the dispute process does not remove the account itself, as I am sure you are aware, unless the account is also deleted.

I just went through this with someone who has an active dispute with EQ for a recent collection. Her EQ FICO jumped when the account went into dispute, she applied with a EQ pulling Credit Union, but they denied her based on the collection.

So based on that, it does not seem this is a solution to your mortgage issue.

 

Well, your mortgage broker does not do a second pull just prior to closing, AND you are truly pre approved, then it probably can't hurt. Are you close enough with your broker to be sure that company will use only that report and score set for fully six months, or is this something you have heard about other brokers policies?

If your latest question is " does it hurt to dispute " at this point then I think the answer is no, it can't hurt.

To be honest, though, I am not sure specifically what you are asking with your latest post though.

 

OK, I understand. First off, the second set of inquiries will pick up a slightly lower score on each report because of the last hard inquiry from the broker, since it won't be coded as the same inquiry if it is separated from the first pull by either 14 or 30 days. I can't recall which period is relevant, but that second inquiry will cost between 2-10 points depending on a lot of variables.

You have two paid collections on your report? Are you aware of:

Rapid Rescore, done by your mortgage broker with your hard copy documentation of their being paid?

The famous " Nutcase " letter by Butch, specifically designed for deletions of paid collections? It is on this site here, post # 7:

http://consumers.creditnet.com/Disc...-2-docs-nutcase-ltrlong-23079.html#post160448

Basic dispute with each CRA, demanding deletion because the account is " inaccurate "?

 

Rapid rescore is nice, but it can cost a substantial amount of $$$ if you have several tradelines you need to dispute. You can take the hard copy documentation that they were paid and call the CRA's and ask for their "mortgage pending" department. You can then fax them the info and they will update it immediately. They will update things such as account balances and paid TL's etc.

It is a cheaper way of doing the rapid rescore, except the rapid rescore doesn't really hit your credit report from what my mortgage broker told me, it just updates the report on their system and they can then see what the new score would be provided that information was on there.

 

Not sure what experience you have with rapid rescore, or how long ago it was you learned about them, but most state laws now severely limit the cost of rapid rescoring. Most times it is a tiny amount now, last time a friend paid for it was last year, she paid $25.00 for her whole file. Certainly not a big expense.

Yes, the rapid rescore does nothing for the long term updates of your credit file, only gets you past the mortgage.

 

I am a Realtor in Upstate NY, last year when we purchased our house I had to get my Wifes scores up and when I spoke to them about Rapid Rescore, they were talking about charging me $400 per TL that needed to be updated, and we were updating like 6 or 7 TL's for balances and things of the sort. I did the math and was like...$2800, on top of downpayments, and closing costs, and moving expenses etc, etc.

So I said there has to be another way. That's when I got on the phone with the CRA's and started talking to them. After hours, and hours on hold and transfers and finally getting the right peron on the phone, I found out about the Mortgage Pending Dept. Only 2 of the agencies had this department 1 year ago. By faxing them the required documentation, I shot my wifes score up 85 points on 2 reports in 1-2 weeks.

My mortgage broker was amazed, he had never seen anyone do that before. Maybe they were trying to rape me on the Rapid Rescore thing.

 

Joey:

There are many reports across the nation about brokers grossly overcharging for rapid rescore, which is why so many state governments got involved and passed laws which govern the industry. Many times the realty industry gets directly involved in the legislation.

You may also have run in to the wrong type of rescoring company, as many mortgage brokers are not as well informed about the choices they can offer their customers as we might expect them to be.

My friend had precisely the same perception you did (she is a realtor also) when she went to purchase her first home last year. First pass she backed away from the rapid rescore for the same reason you did, then I prompted her to begin asking different questions of different mortgage brokers, and next thing she knew she was paying $25.00 per report or per three reports (I can't recall, but it was tiny) for the group of her updates.

 

Another explanation, sometimes the presence of a negative tradeline isn't always a net negative score-wise.

For instance, if you have a 6 1/2 year C/O, the age of the tradeline, and other factors, could actually cause a GAIN, instead of a LOSS for the account being C/Oed.

The dispute, and possible masking or deleting of that tradeline could then cause a LOSS.

 

Wow, that I didn't even know or think of. It is definitely very interesting. It's also nice to know that you can get things updated on your credit reports rapidly, provided you are in the process of purchasing a home, either through the mortgage company and/or through the CRA's. In fact, if you are in the process of purchasing a home, it would make sense for anyone that is on this board to use the fact that they have a mortgage pending to speed the process of some repair work on your credit with the CRA's, or do you see a possible downfall in doing this?

 

Reading the details again of your post, I'm amazed your FICO dropped by only two points. The account must be at least five years old, which is helping your average age/history amount. A 30 day late is not considered a "serious" derogatory (60 days or more = "serious").

If it is only your score you are concerned with, a deletion of this account will definitely lower your FICO score. For this example, the positive effect of the "aging" outweighs the negative effect of the 30 day late. Most lenders in a review of a credit report tend to "forgive" a few 30 day lates sprinkled throughout the report.

And this scenario of the model is reasonable; think about how it looks to the reader: an account that you've had for 5-7 years where only once you were "slightly" late is a pretty good record, no not perfect, but very close.

It may be too late to "pull" the dispute, but this is a case where maybe dealing directly with the account holder would work out better. I have found that most companies do forgive 30 day lates if there is a valid and understandable reason.

 

Well, it is important to remember that Rapid Rescoring is not real credit repair. It is only temporary. Any updates the rescoring does is for the projection of what your score would be like, not what it is. So any original documention which the rescoring uses to remove derogs is done only for the mortgage application and the tri merge report and scores.

You must do precisely the same credit repair after the rescoring as if nothing had been done at all. The reason? Nothing HAS been done to the actual data the CRA's have for each of your three files.

Make sense?

 

absolutely....thanks, i appreciate it.