I've seen some amazing posts on this fantastic sub and I'm hoping for a bit of advice.
I’m working on becoming a first time home buyer in Illinois and am looking to boost my credit scores to get the best possible rates. My first pre-approval letter gave me a rate of 3.875% to borrow $225,000.
Here’s my credit score situation:
- Experian = 820
- TransUnion = 713
- Equifax = 710
I have a debt collector (Midland Credit Management) who has slapped a $1,500 inquiry on TransUnion and Equifax. There's a note saying "40 Derogotry public records or collections filed".
Details on the $1,500 inquiry from Midland:
- Started in 2016 allegedly due to an American Express Costco Credit Card
- I received paperwork from MCM over the years but ignored it. Never went showed up to court or anything. Haven’t been contact by them for 1-2 years.
- Current status on my credit report is that it is “In Dispute"
- I typically set all my credit cards on auto pay, never had financial issues. I’m 90% sure I did not miss a payment but am not completely confident.
These are the options I’ve been presented with from various people:
-
[Option A]: Ask MCM to validate the debt and dig into whether this debt is legit. Worst case situation, it is a legit debt and I either pay the full thing or negotiate for a “pay to delete”. Even if I need to pay the whole thing, it isn’t the end of the world for me financially.
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[Option B]: Don’t reach out to MCM at all and consider reaching out to Equifax/TransUnion and tell them this collection is “no longer in dispute”. Apparently this might bump up my score by a few points by saying "Yes, they're asking for money and I'm not disputing it. Apparently, having it "settled" like this is better than having it constantly in "dispute". Not sure how accurate this is.
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[Option C]: In addition to [Option B] of ignoring MCM, I can boost my scores by becoming an authorized user on 2 cards which obviously have good long track records. The loan officer advised that the issue with my scores is caused by opening/closing cards too much over the years and that becoming an authorized user will have the best chance of improving my situation and battling MCM will not do much. But I’ve also heard that underwriters will see right through this.
Any and all advice would be greatly appreciated. Thank you so much in advance for helping me brainstorm.
Submitted June 25, 2020 at 08:56PM by Insignia89 https://ift.tt/2VezPsX
