credit record issues

Guest

Hi, I had some credit issues before and honestly i was not being too responsible for my actions, however in this past year i printed out a copy of my credit score, and all 3 credit agencies scored it differently but the highest was a 520. Ever since then, i have cleared off 4 accounts that were delinquent and I am in the process of clearing off the last one. Once the last one is remove, how long should i wait before applying for a home loan, and how much do you think it will increase my credit score.
Thanks.

parmoney · Joined: 05 Dec 2008 Posts: 37 11.32 Dollars($)

Do you have any accounts in good standing now? If not, I would recommend opening up some accounts and start proving to your debtors you are good for a return on their investment in you.

gmakerley · Posted: Mon Dec 15, 2008 1:12 pm Post subject:

parmoney makes a good recommendation. i will add to that - if you plan to do it, you'll want to be sure you use them wisely - keep your balances at a minimum and pay them off every month (to save interest costs). keep them open no matter what.

elnoralittle · Posted: Mon Dec 15, 2008 7:01 pm Post subject:

most lenders would like for you to be 12 months clean. But the minimum credit score for fha is 580.

I suppose it all depends on why you became delinquent. Some times things happen, we are all human. But it is the lender's job to make sure that the payment you are placed in is affordable for you and there is minimal potential for you becoming delinquent on a mortgage.

Be sure that you are ready. Try to save a little to put down. I would start by setting aside the monthly payment that you think you could afford for atleast 6 months. That way you know if you are truly ready.

jameshogg · Posted: Mon Dec 15, 2008 8:12 pm Post subject:

Hi Jose Rodriguez,

I agree with Elnora that the minimum score required to get FHA loans is 580. If your credit score is below that, you will not be able to get mortgage. However, if you try for a mortgage with a 580 credit score, then you should not have any late payments or collections mentioned in your credit report.

So I would suggest you to wait for at least 6-8 months before applying for a mortgage. In between follow the suggestions and advice given by Parmoney, George and Elnora to improve your credit. This will have a positive effect on your credit report. Also check out the following link to know various other ways to improve your credit score:
http://www.mortgagefit.com/credit-rating/credit-repair.html

Thanks

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