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Home >> Credit Repair Forums >> Applying for a Mortgage - Credit Report

Applying for a Mortgage - Credit Report

eredas said: "I have acounts that were in collections and some charged off that came off my credit report - because they are over 8 yrs old - When I apply ofr a mortgage oan - will these accounts come up and can they affect my credit score thanks"

kevin said: "They will still show up on your credit report, however, they should not have any effect on your recent FICO scores. The only time charge off's will affect your mortgage loan or FICO score is when they are within the last two years and the amount of the charge off's are over $2000. Most lenders will require these accounts to be paid off within the loan or prior to funding outside the loan."

MichaelG said: "If the collections are off your credit report, they are off. They will not come up again by applying for a mortgage. Lenders have different criteria for handling collections. Some are more lenient than others, but you need not worry since you said they are off your credit report."

salesbiz said: "[QUOTE=kevin]They will still show up on your credit report, however, they should not have any effect on your recent FICO scores. The only time charge off's will affect your mortgage loan or FICO score is when they are within the last two years and the amount of the charge off's are over $2000. Most lenders will require these accounts to be paid off within the loan or prior to funding outside the loan.[/QUOTE] Kevin, I have several charge offs that are over 4 years old and beyond SOL here in NC. But it is obvious they are pulling my scores down. I am current on everything now, mortgage included, but I have scores in 540 range. Are you sure charge offs only hurt your score for 2 years? I know they don't drop off the report for 7 years from last activity. I am trying to refinance and combine a 1st and 2nd together. Thanks"

kevin said: "Charge off's do not have a negative effect for more than about 2 years, if that. If that were the case, wouldn't your credit scores be below 500? If you are trying to consolidate the first and the second mortgage, you shouldn't have a problem with a 540 FICO, but make sure the interest rate on the first is high enough to make it worth it to refinance."

MichaelG said: "[QUOTE=kevin]Charge off's do not have a negative effect for more than about 2 years, if that. If that were the case, [COLOR=Red]wouldn't your credit scores be below 500? [/COLOR] If you are trying to consolidate the first and the second mortgage, you shouldn't have a problem with a 540 FICO, but make sure the interest rate on the first is high enough to make it worth it to refinance.[/QUOTE] Not necessarily. As long as a chargeoff is reporting at all, there is a negative fico factor. If that wasn't true, there would be no reason to dispute and have the CRA delete a chargeoff older than 2 years. I've had several 4 yr old chargeoffs deleted and as a result saw my scores increase by over 30."

jrmoro said: "[QUOTE=MichaelG]Not necessarily. As long as a chargeoff is reporting at all, there is a negative fico factor. If that wasn't true, there would be no reason to dispute and have the CRA delete a chargeoff older than 2 years. I've had several 4 yr old chargeoffs deleted and as a result saw my scores increase by over 30.[/QUOTE] If a charge-off is showing on your report it will give you a lower FICO score... period. All you have to do is look on your credit report and it will show how many trades (loans) that you have had, and how many public records, and negative trades. If it has fallen off because of time, it will not effect your score!"

rapidanian said: "A derogatory on a credit report is a derogatory and it adversely affects your score. Any collection reporting after 7 years after DOLA needs to be disputed as old so it can be deleted from the reports. Attn, Salesbiz...even with a score of 540 you may be able to refi. Have you spoken with a mortgage professional who has pulled your scores and looked at your current mortgages? How much equity over and above your 1st and 2nd do you have? Congrats on bringing your accounts current. This will help your score go up...watch your utilization also."