Ok, just starting this looking into our credit report to see what can be cleaned up before we go mortgage shopping. From what I've gathered in reading, no derogatory credit lines past the 7 year reporting time should be on it, and if so, I can dispute them as what? (official term needed here). Also looking at a Transunion report for 1/02, I just ordered 3 fresh ones snail mail and dont have them to compare yet. but there are 3 accounts in collection that are not near the end of the 7 year reporting. The combo of all 3 are under $1,000, 2 medical and one from a local ordinance fine, which I would just as soon pay all of them totally and clear up, but how do I get them to appear least damaging on my credit report? Also, there is a civil judgement, which we were not aware it was a judgement, since funds were garnished from our checking account and resolved with the first court date, we have the papers from court saying the matter was settled, but it obviously was placed at the same time the funds were garnished, not after the court date, but nothing was filed sayin it was paid. Located in IL..in Cook County if that helps. And last, a biggie, an IRS tax lien that was paid in full Dec. 02. We have no new lines of credit established except for a 1st and 2nd mortgage on the house, which neither have any lates showing in the past two years, and a corporate credit card my husband pays off monthly, which I dont think shows on any of the CR. So I dont expect any surprises on the new reports I've ordered, just want to make what we do have on there look the best it possibly can. We're looking at about $100,000 mortgage, with having about $45,000 equity in the home we will be selling, and plan on putting all or most of it as down payment. Income by the calculators I've played with is sufficient for the home we are seeking, but because of past credit problems, we're worried the low rates will not be available. Our time frame is flexible, but with the low interest rates now, as our other two mortgages are both at higher rates. Income wise quite a few of the charts are saying this is not possible to do a 15 year fixed mortgage because of our past credit problems, but with an income of $52,000 and a good job history, no lates on the mortgage, and hopefully cleaning the above mentioned issues up, we can do this. Any feedback on any of the issues, would be greatly appreciated!
First, I would check your fico score. That would give you a very good idea how the lenders will see your credit. You might try and negotiate with the chargeoffs. You will pay if they will remove from your credit report. The experts on the board can probably give more info about it. Read the first 4 posts. They are a wealth of information. You are headed in the right direction. Ordering your credit reports etc. Hope this helps.
If you called me up and told me all this, I'd say, "Don't worry about it, let's go buy a house. Do you have a Realtor yet?" And then I'd write you a prequalification letter. Tax liens and judgments are not good for your credit, but the important thing here is that they've been paid and you've got proof they've been paid. The collections are minor and you're willing to pay them, so they're not a huge issue either. I'm a little concerned that you say you have no new lines of credit established because I'd want to see some to balance these negatives, but unless the only things on your credit are these negatives and the mortgages, you should still be okay. You don't need perfect credit to buy a house at a good conforming rate. You've got a large down payment and your income is very good, that counts a lot in your favor. If you wanted 100% financing and had weak debt-to-income ratios, I'd tell you something different, but you don't. The only thing that could be a problem here is if your actual scores are really bad. If I were in your shoes, I wouldn't wait on getting credit reports via snail mail, I'd just go get prequalified.
