I've been in a few positions in my career that have taught me a lot about the do's and don'ts or credit. I've also done a bit of credit repair for clients too get them to qualify for the best loan possible. Unfortunately, I've heard many stories about mis advice that ended upp doing more harm than good when it comes to working with fico scores. Here a few tips that I think will help. - Keep revolving debt at 30% or less (credit cards and such- (reallocating debt might be a good option)). For the most part there is no need to close old credit cars, having a few available credit sources with a high available balance and low actual balance will greatly help increase a fico score, most lenders want at least 3 trade lines that are open. In some cases a lender will prefer to see that an account be closed or settled if it is currently an open collection account. There are a few ways to go about this and each case should be looked at individually to maximize the benefit to the borrower (sorry not one answer for everyone). For example paying off an old collection in many cases will actually lower a credit score (due to the account becoming "active" in the process of being paid off). A good tip is having the lender get their required credit report before you take care of the collection. Then get the paperwork showing that the collection has been taken care of, and the lender will be able to use the FICO score that has not been affected by the settling of the collection. -Wow, Hope I didn't get carried away there. Know it sounds Cliché but I guess I get a little passionate about my job. Anyway, if anyone wants me to look at any particular scenarios, I would love to put in my 2 cents free of charge.
A good tip: If you have a couple months before your client is ready to purchase or refi it's always a good idea to review their credit ASAP to ensure that when the time comes they will have done all they can do to ensure the best loan terms.
Brendan Burgess
Phone (702) 987-4812
Toll Free (866) 689-1843
Email: Brendan@properhomeloans.com
Comments(0)