Posted on: 30th Sep, 2008 05:10 pm
I have two voluntary repossessions listed on my credit report from 2005 and 2006. These are listed as voluntary repossession/never late.
One has the balance owed as $0 charged-off 2005 on the report with a Largest Past Balance of $14970. It is a joint account with my ex's mother and I have a payment plan.
The other shows $4500 charged off. I plan on settling the $4500 before applying for a mortgage.
Questions:
1. Does the other repossession count if the credit report shows a $0 charged off status?
2. Does the balance of $14k hurt my chances of getting a mortgage, even if the full charged-off amount does not show as the current balance on my credit report?
I did the debt to income ratio calculator with the payment plan included and it said my DTI was 22%. Not sure how repossessions, even voluntary ones, affect your loan application and/or how old they have to be to not count that much. Five years? :?
One has the balance owed as $0 charged-off 2005 on the report with a Largest Past Balance of $14970. It is a joint account with my ex's mother and I have a payment plan.
The other shows $4500 charged off. I plan on settling the $4500 before applying for a mortgage.
Questions:
1. Does the other repossession count if the credit report shows a $0 charged off status?
2. Does the balance of $14k hurt my chances of getting a mortgage, even if the full charged-off amount does not show as the current balance on my credit report?
I did the debt to income ratio calculator with the payment plan included and it said my DTI was 22%. Not sure how repossessions, even voluntary ones, affect your loan application and/or how old they have to be to not count that much. Five years? :?
Hi jdlegall!
Welcome to Forums!
Yes, as far as I know, your other repossession will count and the balance amount will hurt your chances of getting a mortgage. As far as your credit is considered, both a voluntary repossession and a standard repossession will affect your credit rating in the same way. Any repossession will have a significant negative mark on your credit history and will lead to a significant credit score drop. It will also mark you for a serious credit risk. The lender will attempt to collect on any balance remaining on the debt after he sells the house at an auction. The lender may even file a lawsuit against you to collect on the unpaid deficiency balance.
Feel free to ask if you have further queries.
Sussane
Welcome to Forums!
Yes, as far as I know, your other repossession will count and the balance amount will hurt your chances of getting a mortgage. As far as your credit is considered, both a voluntary repossession and a standard repossession will affect your credit rating in the same way. Any repossession will have a significant negative mark on your credit history and will lead to a significant credit score drop. It will also mark you for a serious credit risk. The lender will attempt to collect on any balance remaining on the debt after he sells the house at an auction. The lender may even file a lawsuit against you to collect on the unpaid deficiency balance.
Feel free to ask if you have further queries.
Sussane
Repossession will definitely count and will also affect your credit rating. It will result in a negative mark in the credit history. In will hard for you to get mortgage because of the balance amount.
Both reposessions are going to count.
With out seeing your credit report, it is hard to know exactly what shows.
If you have a payment plan with the creditor, you should obtain a copy of the agreement and a letter from them stating that you have paid on time consistantly. This will show that since 2005 you are making on time payments.
What lenders fear on these types of transactions, is collections and such can turn into judgements, and when they do, judgements can be attached to property. That said property could be the home you purchase in which the lender has a vested interest.
If you pay off the $4500 reposession, see if your lender can do a credit rescore when you provide evidence of the payoff and aggreement with payment history on the larger repo.
FHA loans are more credit lenient, so you might want to get pre-qualed with a lender. Beware of lenders asking for money upfront.
Any knowledgeable lender should be able to sit down with you and help you financially plan or prepare you for home buying.
With out seeing your credit report, it is hard to know exactly what shows.
If you have a payment plan with the creditor, you should obtain a copy of the agreement and a letter from them stating that you have paid on time consistantly. This will show that since 2005 you are making on time payments.
What lenders fear on these types of transactions, is collections and such can turn into judgements, and when they do, judgements can be attached to property. That said property could be the home you purchase in which the lender has a vested interest.
If you pay off the $4500 reposession, see if your lender can do a credit rescore when you provide evidence of the payoff and aggreement with payment history on the larger repo.
FHA loans are more credit lenient, so you might want to get pre-qualed with a lender. Beware of lenders asking for money upfront.
Any knowledgeable lender should be able to sit down with you and help you financially plan or prepare you for home buying.
Thanks everyone.
To smithsussane & Guest:
Not worried about the credit score in this area as it does not hurt my score much right now since this information went on in 2005 and has not changed since then.
The first repossession for $14K shows a $0 balance with charged off status. The second reposession for $4,500 still shows that as the balance owed with a charged-off status. When these first hit my credit report my score dropped to 497 due to the repossessions and other negative accounts.
I paid down 95% of my credit card debt and when I asked this question my credit score was 606. The last outstanding credit card debt that I paid off recently has been updating and with it's recent update my score is now 618 as of yesterday. So...right now the repossessions aren't hurting my score as much as the would if they were recent.
To Elnora:
Yes, I was a paralegal so I know how judgments go. LOL That's why I contacted them, set up a payment plan for one account and promised the settlement at year's end for the other. Right now, they have put several settlement offers on the table that are not right for me yet, when I receive one that works for me in my current budget then by all means I will take it.
I also have records of payment and copies of the payment plan agreement, so that won't be too hard to prove to a lender that a judgment won't be possible. The payment plan is included within my current household budget along with an automatic withdrawl to a savings account which will be used for the down payment, closing costs and reserves.
Within 18 months, the negative accounts on my credit report will be paid and aged so that the negative notations will be updated to current. I have talked to Bank of America three times and their mortgage folks have given me conflicting information with regards to Self-Employment Income and tax returns. Which is essentially why I am here asking for clarification. :D
To smithsussane & Guest:
Not worried about the credit score in this area as it does not hurt my score much right now since this information went on in 2005 and has not changed since then.
The first repossession for $14K shows a $0 balance with charged off status. The second reposession for $4,500 still shows that as the balance owed with a charged-off status. When these first hit my credit report my score dropped to 497 due to the repossessions and other negative accounts.
I paid down 95% of my credit card debt and when I asked this question my credit score was 606. The last outstanding credit card debt that I paid off recently has been updating and with it's recent update my score is now 618 as of yesterday. So...right now the repossessions aren't hurting my score as much as the would if they were recent.
To Elnora:
Yes, I was a paralegal so I know how judgments go. LOL That's why I contacted them, set up a payment plan for one account and promised the settlement at year's end for the other. Right now, they have put several settlement offers on the table that are not right for me yet, when I receive one that works for me in my current budget then by all means I will take it.
I also have records of payment and copies of the payment plan agreement, so that won't be too hard to prove to a lender that a judgment won't be possible. The payment plan is included within my current household budget along with an automatic withdrawl to a savings account which will be used for the down payment, closing costs and reserves.
Within 18 months, the negative accounts on my credit report will be paid and aged so that the negative notations will be updated to current. I have talked to Bank of America three times and their mortgage folks have given me conflicting information with regards to Self-Employment Income and tax returns. Which is essentially why I am here asking for clarification. :D
No job and a bad marriage, ex filed bankrupt and I was left with car debt and no job. My car was sold for the total amount of debt. I was notified yesterday 3-2-09 debt is paid. Can I do something or request some kind of update to my credit report?
Yes, you can definitely request for a update. You can contact the credit bureau and get it updated yourself.