Author Topic: Question for Chant (Read 620 times)

Dawn · « **on:** July 13, 2007, 10:15:53 AM »

Matthew,

Help me figure this out. When my husband was laid off a few years back, We went behind in our credit cards. We have finally started to whack away at these as well as some hospital bills that had goone to collection. I am trying to get my mortgage redone as my ARM is due in Septemeber. So, my husband called the mortgage company to see if they could do anything now, in light of the fact that 3/4 or our credit problem has been corrected. The man said that the worse thing we could have done for ourselves is to pay off those cards and close the accounts. Becasue of the accounts being closed it will be almost impossible to get someone to look at my mortgage. It seems that to have been a few months delinquent (we were many months behind though), looks better than paying the account and closing.

How is this? I thought I was helping us and instead to mortgage companies I have hurt us beyond repair it seems.

Any one else's suggestions are welcomed as well Thank, Dawn

Matthew · « **Reply #1 on:** July 13, 2007, 10:19:56 AM »

Yeah, the credit rating system doesn't always jibe with common sense.

I think Michael Solimanto could help you on this one -- it's his line of work.

I only study finance and real estate as a hobby :detective:

Matthew

Dawn · « **Reply #2 on:** July 13, 2007, 10:37:54 AM »

Thank you Matthew

Matthew · « **Reply #3 on:** July 13, 2007, 10:44:51 AM »

I can tell you that they look at "total credit" and such -- and by closing accounts, you have less credit available -- so however much you owe is divided into a smaller amount.

Owing $2,000 on several cards with a combined limit of $15,000 looks much better to them than $2,000 on a single card with a limit of $3,000.

That is why he said it hurt you to close those accounts.

But whatever you do, don't open more credit card accounts now to fix that! When you "seek credit" that seems to hurt your score, at least in the short-term. And applying for a mortgage goes into this category, so you want it to be your ONLY instance of seeking new credit.

By the way, isn't it the worlds biggest euphemism that they call credit cards "credit cards"? Credit is a positive; debit is a negative. You don't have "credit" at a store unless you have left money with them for future purchases!

If they called them "debt cards" or "slavery cards" I'm sure fewer people would use them

Matthew

MichaelSolimanto · « **Reply #4 on:** July 13, 2007, 03:54:21 PM »

Quote from: Dawn

Matthew,

Help me figure this out. When my husband was laid off a few years back, We went behind in our credit cards. We have finally started to whack away at these as well as some hospital bills that had goone to collection.

Did you negotiate for a lower price? Hospitals charge more for uninsured than the insured and if you can snag the hospital before collections you can get a "cash" price. If it goes to collections they will accept roughly 55% of the bill, but start at 40% and keep a calculator handy and see what they counter at. It's usually 65% to 70% of your debt. Just be ready to counter and have a good reason for them to accept, namely, you can pay them.

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I am trying to get my mortgage redone as my ARM is due in Septemeber. So, my husband called the mortgage company to see if they could do anything now, in light of the fact that 3/4 or our credit problem has been corrected. The man said that the worse thing we could have done for ourselves is to pay off those cards and close the accounts.

Mortgage brokers/loan officers aren't credit masters, they only pretend to be. You should see what your score is and see what you can do. Do you have equity? There are tons of intangibles, I would like to help you, but this is not an easy answer and listening to some loan officer isn't really a good gauge.

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Becasue of the accounts being closed it will be almost impossible to get someone to look at my mortgage. It seems that to have been a few months delinquent (we were many months behind though), looks better than paying the account and closing.

Than he's lying or ignorant of the programs still available. You probably need credit repair with a reputable company (I know one that is cheap). It's still workable.

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How is this? I thought I was helping us and instead to mortgage companies I have hurt us beyond repair it seems.

I have to see your credit report. The rest is useless speculation. Bear in mind that loan officers are worthless to know credit matters except what kills your options with certain banks.

The biggest problem is with being late on your loan.

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Any one else's suggestions are welcomed as well Thank, Dawn

Miss_Fluffy · « **Reply #5 on:** July 13, 2007, 07:28:04 PM »

I wonder if you can try and reopen those accounts without reapplying? Just a thought, probably a long shot though.

I do know they look at the ratio of credit available to you vs. how much you owe overall. So if you have lots of credit available on open accounts, that's a real good thing.

Mike, Do you have a recommendation for a good credit repair place? I'm in desperate need of help myself, as I had a car repossesed a few years back due to unemployment.

MichaelSolimanto · « **Reply #6 on:** July 14, 2007, 05:16:51 AM »

Sure I do, but I can get you a better rate directly because he's $249 a person but I get a $40 kick-back and I never use my kickback so I'll try to get it for you for $199. The guy is good. 40% deletions on average in the first 30 days. He just helped one client of mine and took off 80% in the first 60 days.

Send me a PM.