T Nation

Credit Score Help


#1

My wife and I are currently working on getting a mortgage, and have hit a glitch with her credit score. The lender told us the loans are based on the middle of the three scores from the credit bureaus. My wife's scores are 741, 639, 615. I have copies of all three credit reports in my hand, and can't for the life of me figure out what is the difference between the three. The two lower ones even state "No negative accounts" on them.

Anybody work with credit scores/loans that can help me figure out what to do to get the lower scores in line with the higher one?

Thanks.


#2

Bump, so this doesn't fall off the front page.

Also, PM Angrychicken if he doesn't respond.


#3

With that large of a range my guess is that your wife simply doesnt have a large credit file. If she hasn't had very many loans, credit cards, etc. in the past the score could vary widely from bureau to bureau. Obviously I havent seen her credit file but that is usually the reason for variances between bureaus. The only other logical reason would be that her banks that she has had loans with only report to one or two bureaus instead of all three (usually only very small rural banks do this). Most banks and financial institutions respect your Equifax score the most, followed by Transunion. Most could care less about your Experian score and some wont even look at it. If her 700+ score is with Equifax your best bet may be to try to deal with a different bank. Some banks will only pull and Equifax report and not even worry about the other two.

The only real way to get the other two scores up is to open some accounts and pay them on time every month. Auto loans, credit cards, student loans, etc. with on time payments every month are the only thing that is going to raise those other two scores. Unfortunately there is no "quick fix" to getting the rating up.


#4

Thanks for the reply. Definitely not what I wanted to hear, as we are really looking for a "quick fix."


#5

On the 2 lower ones compare the following with the highest one to make sure they contain the same info (even then it will vary some).

  1. Longest account (in total yrs that is still active) w/revolving balance (typically some type of credit card)

  2. Amount owed compared to available- if you have 3 credit cards are they present on all the different reports?

  3. I assume payment history is same on all 3 reports? Meaning if the highest one has no missed payments, same is true for the lower score reports?

  4. Do the lower ones have more recent credit inquiries?

those are the 4 criteria that make up the bulk of your credit score:
length of credit history, amount you owe vs what you have available, payment history and credit inquiries.

the 2 lower scores should give an indication of what is negatively impacting your score. Along with what is helping.

perhaps check out www.MyFico.com if you can't figure it out with what you have in hand, and a computerized version may guide you.


#6

Get a new wife with a credit score closer to 800.


#7

FICO is voodoo and trying to figure it out is bizarre. I paid off a loan and my credit score went from 840 to 800.

That said, my guess (for you) is that some of the balances are incorrect/different on one or more of the credit reports.


#8

Well Experian generated over $700M in Credit Services revenue in North America during 2010, so obviously someone is reading them. Or they are spending $700M on stuff they "could careless about".


#9

Just to clarify, my point was not that your Experian score isn't important. Obviously it is out there for creditors to pull so has some importance. I was just trying to explain which bureaus hold more wieght with banks and which are looked at most often. I deal with over 20 different lenders on a daily basis including most of the largest banks in the US (US Bank, Bank of America, Citi, Chase, Ally Financial, etc). While some of them do take an aggregate score between the 3 credit bureaus, many of them pull ONLY an Equifax report. I can count on one hand the number of lenders I work with that even pull an Experian report.

My point is I know of many national banks, including some of the largest and most respected lenders in the nation, that pull only an Equifax report - and several others that pull only Equifax and Transunion. I know of exactly zero that pull only an Experian report. So what I was trying to imply to the OP is that if her Equifax score is the 700 score, he may be able to go to a different bank and get an approval.


#10

^ Quick question is it true or false that the more times your score is pulled it lowers it?


#11

True - to an extent. Your score will drop very slightly if pulled by numerous creditors in a short period of time. For example, if you go into one bank and apply for a mortgage and they pull your bureau once the score probably will not drop at all. But if you go into a car dealership and they send your application to 6 different banks who all pull a bureau your score could drop slightly. The drop is usually very small but banks do look at how many times your bureau has been pulled in the last 6 months. If they see a huge amount of inquiries in the past 180 days they may be leary of loaning you money because they will be worried about how much debt you may rack up if you actually get credit from all the people who have pulled your bureau.

So in short, yes your score can drop if pulled numerous times in a 6 month span but the drop is usually not significant and should not be a huge concern. The only way it will be any type of significant drop is if you for example apply for a home loan, a car loan, and several credit cards in a short period of time.


#12

^ Thanks


#13

Waiting on the PM unless you want your personal business out there...

I CAN fix your wife's credit quickly (20 to 30 point boost in less than a week in most cases).

Some of the info in this thread is good, some of it is dated...

If her mid-score is 639 I don't see why you are having trouble getting a loan... Is it a high balance loan amount? Conventional? FHA? VA? What's the LTV? Is there another factor preventing you from qualifying?

PM me with as much detail as you can think of and I'll tell you what to do.

We may need to actually correspond IRL (in other words, I may need to actually see the credit report because most people don't know what the hell they are looking at and different reporting agencies put the information in different parts of the report so I wouldn't be able to tell you exactly where to look, I'd have to see it for myself), so if you're uncomfortable with that, the help I may be able to give you will be limited.

There are a lot of reasons why the scores are so different. The main reason is that EF, TU and XP all use different algorithms to calculate the score. Also, some of your creditors may not be reporting to all three repositories so they may not have the same information. Or the information may be incomplete. For example, if they don't fill in the "High Limit" field on a particular tradeline, the BALANCE becomes the high limit and it fucks the ratio all up. There are literally HUNDREDS of things that can fuck up your score.

Hit me up.


#14

Thanks everyone.

I'm not shy, and maybe it will help someone else.

I'm not working right now, so the loan is all in her name. FHA loan. Not a high loan amount at all. The only payments in her name are $130 student loan, a $170 timeshare (yes, we're those idiots), a $240 capital one bill (13k balance on 16k credit line), and our old mortgage on a house we are renting. The rent is $1400 and our monthly payment on that loan is $1336. I understand she can only use 75% of the rent as income for the new loan.

Her income is about $3500/month, but she is getting a $8/hour raise this month (that contract has been provided to the lenders).

Thanks again. I'll PM you to see what private info you need.


#15

I'm not running the #s, but on that income (you none) and the monthly debts, I'm not seeing you getting approved for much, even with stellar credit scores.

though is that $3500/month take home, or before deductions?

and if you can only use 75% of the income from rent, well that's a loss right there doing the math, so that's more monthly debt counted against you.

ok, so I just ran the numbers, assuming $42k/yr in total income. With those debts, you're not gonna get approved for a mortgage, even if she has an 850 score. Or am I missing something?


#16

though I didn't take into account the raise, I still don't see it happening


#17

Thanks everyone for your help.

Special thanks to angry chicken for actually calling me and going over the numbers.

T-Nation is great.


#18

I just want to know if that is AC in his Avi?


#19

Wow, you have been in that Hotel for a long time.


#20

^ Hahahahahahahahahahahahahahaha