In any case, getting back to your situation, it is odd that he has such a low score based on what you’re describing. I would therefore recommend talking to a local expert and going over your credit reports in detail. Maybe they can find something specific that you’re missing (because to be honest, without seeing it I can only speculate at best).

As for your daughter, it really depends on how you add it. If it’s just a name with no financial responsibility, then it might not really help. She’s probably better off get a secured credit card, which is in essence the same as an ATM card but where each transaction is done through the Visa/Mastercard network. You cannot borrow on these cards, you can only use up as much money as you have in your account.

We check our credit reports every month just to make sure there is nothing on there.

The debt we paid off was just around $1000.00, and the collector was a local collection agency.

Our current mortgage lender told me they dont look at mortgage payments to determine if we can get a new loan. I would have thought that that would have been the biggest thing they would look at.

Also, another question if I may,
My daughter is almost 18 and leaving for college in the fall. Should I add her to one of my store credit cards (like kohls) to help her start to establish her own credit?

Have you requested to have a credit report? Always look at your credit report because there may be some mistakes, omissions, etc. Although we like to believe the credit reporting system is perfect, just like everyone else they do make mistakes from time to time. The good news is that if there’s a mistake, it can be fixed!

Other than that, it really depends on what you mean by went into collections. Depending on your situation, it may take some time to show a history of proper payments, which you’re absolutely doing! Keep up the great work!

So to re-iterate, I’d first get a report to verify that everything is accurate, that there are no blatant errors, etc. If everything looks as it should, then it’s probably just a matter of time depending on how bad it was in 2003-2004. Each year will get better and better.

The other thing to note is that you’re also trying to get a mortgage in a difficult financial time, so everything is going to be much much harder. A few years ago he probably could’ve gotten the mortgage by himself. Today you need an almost perfect financial history, guaranteed income, etc. Lenders are being extremely rigid right now.

He had medical bills in 2003 that went into collections in 2004 (that we thought insurance had paid), but in 2004 we paid them off completly. They all show paid with 0 balance.

We havent been late on any payments with our store credit cards..
Weve had our mortgage since 2004 with never a missed or late payment. Our cars are paid off through monthly payments from 2005-2007.

But we cant get a new mortgage because of his credit score. I am wondering why his score would be so low when we dont have any debt?

To be honest, I don’t know. This is actually beyond the scope of this, or any blog. It’s all in the details. Which means that anyone telling you an answer probably doesn’t really know.

That is to say, someone would really have to look into your situation and see exactly what happened, what the paperwork was, etc.

As well, anytime you don’t make your payments because you no longer can, whether it’s a default, a bankruptcy, etc., it will still show up on your credit score. Lenders want to know when you failed to complete your payments.

Congratulations on improving your financial health!! It will go a long way.

Based on what you’ve described you’re doing a fantastic job of improving your credit. I don’t know that there’s any more you can do. You’re on the right path.

All that’s left is time. And this is often the hardest part. Lenders don’t just want to see a short burst of good payment history, they want to see a consistent payment history. Imagine if it was you lending money out. Would you favor someone who’s been paying on time for 10 years or someone who has a bad history of paying on time up until a few years ago? You’d probably favor the person with the better history.

Which means you just have to continue on your current path. It will take time, but it will be worth it.

Congratulations!

Unfortunately it may be difficult for you to get a mortgage. Although I understand there were reasons for your financial troubles, the credit score doesn’t take these into consideration.

The best advice I can give you is to continue paying your bills on time and continue trying to build up your credit.

You may also want to talk to a mortgage broker, they may have some more interesting financing options for you. Just be careful you don’t get caught buying more house than you can afford, like a lot of people in the market today. Buying is not always the best choice, sometimes renting is a better option…

I know you stress the importance of removing incorrect data from credit reports. I have a rather unique situation that might be beyond the scope of this blog, but figured it wouldn’t hurt to ask.

I was recently denied by an underwriter in re-financing my home due to a default/foreclosure on my mortgage in 2008. I’m told I need to wait until 3 years have passed (FHA). My credit scores are actually not that bad and I did qualify for a decent rate before this default was noticed. I had erroneously thought a default was not the same a foreclosure, and since our home was not sold at auction, I thought we we’re alright.

In any event, a unique thought came to mind to possibly remove this default from the credit bureaus and others. We filed chapter 7 bankruptcy in 2005 and did surrender our property, although we stayed in it and made “voluntary” payments.

All former mortgage holders have been paid off and reported to the Register of Deeds in a normal manner -”satisfied in full”. My relative bought the first mortgage and that is all that is left. I wondered if I could send my bankruptcy documents to the bureaus that and argue that the default is recorded in error since the property was surrendered in 2005?

Any ideas or suggestions you have are greatly appreciated.

Thanks!

I now would like to get my score up to 720 so that I can get a good interest rate on a home mortgage after I sell my current home. I applied for a Bank of America credit card and received a letter stating that I could not qualify for an unsecured card because of past delinquencies but that they would issue me a secured credit card. I am considering a $2000 secured credit card with Bank of America but would like to know how much of an impact you think a $2000 secured credit line will have on my credit score. Also should I consider increasing the secured Orchard credit card from $500 to $750 or perhaps $1000.

I’m trying to establish as a good customer with Bank of America because I’ve read that they may convert my secured card to an unsecured card in 12 months which Orchard will never do.