Help - I've ghosted out of the credit bureaus, plus mortgage question
10 years ago
Featured Answer
Sort by:Oldest
Comments (16)
- 10 years agolast modified: 10 years ago
Related Discussions
Repairing credit questions
Comments (4)Jiggreen, First, let me tell you I know what you are going through. I've been through the bad credit nightmare and I got through it and so can you! I agree with Myfask...before you pay off any really old bills, check the Statute of Limitations for your state. Before you jump into a subprime loan, I would do a couple things (I know you're anxious to start the house buying process, but trust me, getting things in order now will save you time and money later on!) 1. Pull all three credit reports and first check for errors. You'd be surprised the number of errors many, many people have on their reports. I had so many that by the time I got through having them corrected, my FICO score went up 30+ points. It doesn't take that long to correct the errors; once you dispute an error, the credit agency has 30 days to prove it's accurate or they have to remove it. Most of mine were fixed within a week because you can do it online. 2. I'm all for paying your debts...if you owe it, you owe it and should pay it. However, it's possible that paying off the smaller "charge offs" listed on your credit reports will not help your FICO score at all. My brother paid off several "charge offs" when he came into some money, trying to do the right thing, and his FICO score didn't budge. HOWEVER, to get a mortgage, the bank you go through may REQUIRE you to pay them off anyway. So it may be best to do so if necessary. Also, before you pay any old debt, make sure it's really YOUR DEBT. If they can't tell you who the original owner of the debt was, then why should you pay it? Collection agencies have to prove it's your debt. And, if you make a payment on a really old debt, THEN find out it's not yours, you may be stuck. In some states, if you make a payment, you are admitting it's your debt. THE STATUTE OF LIMITATIONS THEN BEGINS ALL OVER AGAIN! 3. Don't assume you have to go through a subprime lender. Again, I've been there. I worked my way back from a bankruptcy and bad credit and was able to get a low-rate on a 30-year fixed mortgage. It's hard, but it's not impossible. If you are a first-time homebuyer, most states have a program, usually through FHA, that allows people in your position to purchase a home as long as you have a minimum credit score of about 640, it's your first home and you are within the income levels. I think you can also apply even if it's not your first home. They can also help you with downpayment assistance if you need it. I went through such a program here in CT and my rate is 4.75%! that was a couple years ago, but even now, the state program is lower than any bank on a fixed rate. I saw in your profile that you are in PA. The link below is to the program in that state and it has a question about shaky credit. 4. If a collection agency or credit agress to a payment plan and a reduce payback amount, DO NOT give them access to your checking account for automatic withdrawal! Send them a check or pay online, but do not authorize them to take the money automatically because they can (and will) take more than you authorize them to. 5. If a collector agrees to settle a debt for less than 100%, get them to put the agreement IN WRITING including a guarantee that they will remove it as bad debt on your credit report. My brother was able to do this with a couple and because he had the letter stating that it's no longer a bad debt, he was able to get it taken off the credit reports. 6. The fact that you are now current on your active accounts is good! That does help when applying for mortgage. Keep it up!!! I wish you all the best...you can do it. Just take your time. I know you are anxious to buy now, but with a higher interest rate (and, are there more fees on top of that rate? application fees? etc.), it may not be worth jumping in the water right now. GOOD LUCK!!! : ) Here is a link that might be useful: Pennsylvania Housing Finance Agency...See MoreCredit scores: Playing the game
Comments (3)Knowledge is power. They don't teach much about money management in school. Many didn't learn much about it at home - as children grow, it seems to me wise to have them gain in-depth knowledge, incrementally, of how the family's financial system works. When I was a kid, we got a weekly allowance, that grew as we grew, and we were epected to buy our clothes for school and cover school expenses (which were smaller than currently). World War II began in 1939 when I was 10, the farmhands went off to war and what Dad and this 10 year old, plus a couple smaller, got done - got done: the rest ... didn't. We had lots of work in summer and Dad paid us for that, which helped us buy the things that we needed to return to school and there was an increase in our allowance, to compensate for the increased chores, year-round. We were encouraged to save some - I had a bank account when I was too young to see over the counter ... and we were expected to pay at Sunday School, church-based youth group, etc. from our allowance. In case of dire emergency, we could borrow against future allowance from Dad, which entailed some questions as to whether we might have foreseen the problem, and, even if not been able to have seen it coming, to cover the cost from savings, had we chosen to have some/(any?). And we learned early the discipline of getting along for a while on less after we'd borrowed, for Dad expected us to repay those loans earlier rather than later. Good training as to management of debt ... which would be helpful much later, when "credit" cards appeared on the scene: we knew that they didn't offer "free money". When we use someone else's money - usually they require some compensation (and, sometimes ... way too much: have you investigated the economics of the recently-arrived "payday loan" game?)! After one has stepped into a bear trap - it's a bit late to wish that one had chosen where to put one's feet more carefully! Looks as though Microsoft has cut some of our opportunity for learning about one portion of personal financial management a bit short, also. ole joyful P.S. When one guy, regardless of how central a position he holds in our economy, can become the richest man in the world in half of a generation ... ... do you figure that possibly sometimes people get overcompensated for some innovative discovery that they have made (usually, along with a number of others)? That just possibly our free-market-based economy could stand some tweaking? And the Bolsheviks and the Commuist systems aren't any better - look at all of the newly-minted millionaires ... nay, billionaires ... that have been appearing in Russia and China as their system matures (goes to seed?). And during their heyday, they arranged things so that not too many became part of the core system - didn't want to spread the largesse around too much - or it'd get too thin for each! o j...See Moreoverpaying the mortgage
Comments (30)At my age I plan to stay in the home and not sell. I prefer a lein for the full amount on my property than possibly being unable to pay taxes and payments and losing my home. We had rental property one was in a low income area, I have personally seen what happens to people who have lost their savings. I do not want to live even in a good rental. I personally made sure our home was paid for when we retired. I even worked a part time job to help pay it off. The main question is will you be able to pay your mortgage payments on your retirement. I know to many people who have lost money, as much as $50,000. investing. We owe nothing except for a new car every 5 years. There are a lot of decisions to be made when you retire. My sis and her husband had a choice of $250,000 cash or a pension until they die. They opted for the cash, lost a big chunk of it investing it. Now they can't spend what they have left for vacations, a better home, etc., because the interest on their savings is their income....See MoreHome Equity Loan/2nd Mortgage???
Comments (8)Yes, a home equity loan and a second mortgage are practically the same thing. You will see lenders using both terms. Technically, a home equity loan would not have to be a second mortgage. For example, if you owned your house free and clear (no mortgage), a loan against it wouldn't be a second mortgage, but would be a first mortgage. But the key point to remember is that whichever term they use, they are placing a lien against your home which is securing the loan. The best place to shop for this type of loan is at financial institutions where you currently do business or that are known to you. The first place to check is the mortgage company that holds your first mortgage. They often offer good deal to current customers. That's not to say that some of the lenders who advertise for customers aren't offering good deals -- some are -- but you have to look especially carefully at the closing costs and other fees with lenders who do a lot of mass market advertising. (Of course, you need to check these fees with any lender.) Often lenders will roll the closing costs back into your loan, so that you may get a check for the $10,000 you are seeking, but you may actually be borrowing more than that. In some cases, quite a bit more. Often a good time to get a home equity loan is when you refinance your home. If you are currently paying above market interest rates, consider refinancing and obtaining a home equity loan at the same time from the same lender you refinance with. Often in this case they'll give you a home equity loan with no additional closing costs. As far as the rates you've been quoted, the 4.75 percent seems closer to what I see being offered around where I live. The rates should apply to any amount of loan, not just to large amounts. In fact, many lenders will offer you a home equity line of credit instead of a straight home equity loan. Instead of giving you a check for the amount of your loan, you'll get a check book which allows you to write checks against your line of credit. This is preferable because you don't start paying interest on the money until you actually need it, and if you never need the whole $10,000 available in your credit line, you never actually borrow it. The balance on your home equity line of credit can go up and down just like a credit card balance, and you pay interest on just what you owe. With any loan, just be sure to understand all the fees and costs associated with it. Some lenders, especially those who advertise in the mass media, try to downplay or even hide the fees, and this can mean that what looks on the surface like a good deal isn't such a good deal once you dig down and see what you're really paying....See More- 10 years ago
- 10 years agolast modified: 10 years ago
- 10 years ago
- 10 years agolast modified: 10 years ago
- 10 years ago
- 10 years agolast modified: 10 years ago
- 10 years ago
- 10 years agolast modified: 10 years ago
- 10 years ago
- 10 years agolast modified: 10 years ago
- 10 years agolast modified: 10 years ago
- 10 years ago
- 10 years ago
- 10 years ago
Related Stories

SELLING YOUR HOUSE15 Questions to Ask When Interviewing a Real Estate Agent
Here’s what you should find out before selecting an agent to sell your home
Full Story
WORKING WITH PROS12 Questions Your Interior Designer Should Ask You
The best decorators aren’t dictators — and they’re not mind readers either. To understand your tastes, they need this essential info
Full Story
WORKING WITH PROS10 Questions to Ask Potential Contractors
Ensure the right fit by interviewing general contractors about topics that go beyond the basics
Full Story
KITCHEN DESIGN9 Questions to Ask When Planning a Kitchen Pantry
Avoid blunders and get the storage space and layout you need by asking these questions before you begin
Full Story
LIFE12 House-Hunting Tips to Help You Make the Right Choice
Stay organized and focused on your quest for a new home, to make the search easier and avoid surprises later
Full Story
MOVINGHiring a Home Inspector? Ask These 10 Questions
How to make sure the pro who performs your home inspection is properly qualified and insured, so you can protect your big investment
Full Story
KITCHEN DESIGN9 Popular Stovetop Options — Plus Tips for Choosing the Right One
Pick a stovetop that fits your lifestyle and your kitchen style with this mini guide that covers all the basics
Full Story
REMODELING GUIDESWisdom to Help Your Relationship Survive a Remodel
Spend less time patching up partnerships and more time spackling and sanding with this insight from a Houzz remodeling survey
Full Story
MOST POPULAR9 Real Ways You Can Help After a House Fire
Suggestions from someone who lost her home to fire — and experienced the staggering generosity of community
Full Story
DECLUTTERINGDownsizing Help: How to Edit Your Belongings
Learn what to take and what to toss if you're moving to a smaller home
Full StorySponsored
User