Credit Score in Racine>Question Details

Sarah, Other/Just Looking in Racine, WI

I was discharged from a bankruptcy 16 months ago and my credit score is currently 507. I would like to purchase a home and so I would like to get it

Asked by Sarah, Racine, WI Mon Jan 4, 2010

up to at least 620. I have gone over my credit report and everything was discharged that should have been. I now have 3 major credit cards that are nearly maxed out (limits of $300, $500, and $750). I also have a car loan for $9000. I have been paying everything on time and plan to have the credit cards paid off completely in the next 3 months. I have no collections accounts or other negative accounts on my credit report. I know that situations vary tremendously, but given my information, what do you think the soonest I could reach a credit score of 620 could be? What would be an average lenght of time? Again, I know that it is really impossible to say because so many things affect one's credit score. I am just looking for a guess. Thank you!

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Trevor Curran’s answer
Next step: begin rebuilding your credit. If you have current accounts with good payment histories, or even some previous late-payment-blemishes, make sure you continue to pay those accounts on time. If you do not have any existing credit accounts then you'll need to establish several in order to create a viable credit history.

I have found that CONSUMER ACTION is an excellent resource for objective advice on all things credit related. You'll find free and sincere advice on everything from settling collection accounts to rebuilding credit to building credit from scratch on their website.

Beware of anyone offering to "repair" your credit! The Federal Trade Commission issued a stern warning last year that such offers are scams. Find more from the FTC HERE.

The best way to buy a home is to have a decent credit history combined with sufficient Income and Assets for a home purchase.

The best way to have a decent credit history is to settle negative outstanding obligations and pay all your bills on time for at least two years.

Trevor Curran
NMLS #40140
1 vote Thank Flag Link Sun Apr 29, 2012
I would highly recommend contacting a credit councilor. The fee they charge is quite minimal in comparison to the things I have seen them accomplish. Since they work with people every day that are attempting to repair their credit score I know they will have firm answers for you. As well as offer up some ideas on how to continue on a positive path. If for nothing else, to get on their email list will offer you a lot of great advice. One that several of my clients have used and raved about is
It sounds certainly like you are determined, hang in there!
1 vote Thank Flag Link Mon Jan 4, 2010
Hi Sarah,

You say in your question that their are no negative accounts on your credit report. A bankruptcy is a negative trade line as well as all the accounts that were included in the bankruptcy. These are all negative trade lines and causing a drag on your credit rating. Both your score and your credit rating are in dire need of credit repair and credit education.

I invite you to look over some blogs I have written on Trulia for credit repair and credit score boosts. You would benefit from both.

I would suggest you begin with credit restoration services to see if some of the negative trade lines listed on your credit report can be removed as well as the bankruptcy itself. Also a 620 credit score will qualify you for an FHA mortgage however you are going to pay a lot higher interest rate because the score is still considered poor.

A better credit score of 680 will lower the interest rate substantially on the mortgage loan. The interest rates will even get more attractive at 720 credit score and 749 credit score. Of course it's up to you and many mortgage brokers out there will be happy to place you in a high interest loan with a poor credit rating of 620.

I certainly wish you good luck however, I would again invite you to look into credit education and credit repair for your financial future. It's your money.

Hannah Fliegel
The Credit Restoration Expert
0 votes Thank Flag Link Mon Jan 4, 2010
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