Okay, got $5000 cash, was going to use it for a home loan, but cannot get anyone to approve us, our scores are around 550 on each cb. Now, I need something, anything, that will give us a bump in scores, enough to buy a house. Should I put $1000 of this money into a secured loan at my bank and make payments for 4-5 months, would that give me a boost? Any other ideas? I don't want to use more than $1000 of my money if at all possible. Any help at all would be greatly appreciated. I applied for a loan with IndyMac and was denied online, I called and the guy told me that the min score to obtain a home loan was 620, as you can see we are way far off from that. Thanks!
Sam, I sounds like with scores that low that a shortterm secured loan isn't the answer. I'd suggest paying down or paying off currrent debt will be a more effective use of themoney. Also, what is the cause of the low scores. Is it fixable?
If you don't have an emergency savings fund (not to be confused with your 401K), then I'd suggest parking it in a money market account (ING direct is a good one) and not touching it. In the meantime, use your salary to pay down credit card debt, which will improve your credit utilization and significantly raise your scores. With the money in an emergency fund, you won't be tempted to use your credit cards when something unexpected comes along.
My husband only has two credit cards, both have are maxed, but have low cl's, 700 and 200. I have him as an au on my Cap one. I have another cap one, a fnbm, and a ccb that I could au him on, I haven't had them long, but the payment history is perfect. I could pay most of our balances off, it would help me much better than him since I have more cards, would having him as an au bring his score up much? He would be primary on the loan so raising his score is the most important.
I'd suggest you invest it. You could do a lot with it, from a simple savings account, all the way up to the stock market. It just depends on how aggressively you would want to invest. Good luck, sounds like you have a firm footing with the extra 5 grand.
No, none of the rest of the bad listings on my reports are really fixable. I have been using Junum since August and haven't had a single deletion, I did accomplish some before that, most of them are collection agencies. We had a bk in 1997 so today I am sending validation letters off to all the old credit cards we had, they are coming back verified so I don't know if this will help or not. The bk accounts we have are so old that I don't know if they would even matter, scorewise, if they were removed.
Sam, Assuming the bk is chapter 7, all you can do is make sure the accounts carry a notation of included in bk. And, they'll stay on your reports for 10 years. Your best use of the money will be to pay off the cc debt you are carring and start a savings program. Unless you can come up with a signficant downpayment, your best bet for conventional financing will be an FHA loan. You can qualify for those with 2 years of clean credit post bk. Your best bet is to get debt free and start to squirrel money away.
So you are saying to not try and get a validation on the bk items? They are all showing as bk, so that is not the problem. Is there something wrong with trying to get the creditor to validate the information? Or is this something I should not be doing on bk accounts? I assumed everything was fair game for validation and disputing.
HI, We have a simular situation with our credit scores. We live in Michigan, so I'm not sure if this will be of any help to you. There is a lender here who is an expert in FHA, who is able to get us approved with scores 520 and above with around 3% down. If you would be interested feel free to email me at Beani2Pnut@aol.com. If anything he would be able to give you some really good advise on your situation.
With $5000 in savings, that doesn't leave you much room for a down payment... With your credit scores in the 500's you will probably not qualify for a 100-103% loan so part of that money will have to be used for closing costs, on $100000 property you should estimate around 2000 to 3000 in closing costs... that only leave you around $2500 for a down payment... I don't know the particulars of your situation, but I'd advise saving a little more..
I'm curious Sam, do you eat green eggs and ham? After all, you are Sam I Am... The suggestions that the others have given are very sound, you probably do need to relax, build savings reserves and work on boosting your scores. But if you really are pressed to get into the house in the next 30 days, I do know a specific solution to your immediate problem and a sure way for you to have your cake and eat it too. Email me directly at fico@webbox.com. But don't bother to email me if your household income is such that you can't pay the bills you have and you are really on a plummet instead of a blastoff. You must pay your bills early and never charge more than 35% of your available credit if you want to increase your credit score.
