Tenika

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Hi Tenika,

You could try a Goodwill Letter, but more than likely you’ll need some more time to pass with on-time payments before they would consider removing the 30-day.  If it’s any consolation, the good news is that the damage to your credit will be less as each month passes. 

Thanks for the questions and hope this helps.

Paul

“We’re identifying lending industry situations in FICO Score Trends that to our knowledge have never been seen before,” said Dr. Mark Greene, CEO of FICO, in a statement. “Economic instability is creating unknown risk in lenders’ credit portfolios as well as counter-intuitive trends in consumer behavior.”

The shift to a consumer preference to stay current on unsecured debt, as opposed to secured debt, began last year. In 2009, 0.3 percent of consumers with FICO scores between 760-789 defaulted on real estate loans, compared to 0.1 percent who defaulted on credit cards. In 2005, credit card delinquency risk was three times greater than today. In 2008, the lower to credit cards being just 1.6 times more likely to become 90 days delinquent than were mortgage loans.

The results echo data released by credit info provider, TransUnion, earlier this month. That study from earlier this month, found the share of borrowers who are delinquent on their mortgages but current on their credit cards rose to 6.6% as of Q309 (from 4.3% in Q108). At the same time, the share of borrowers that are delinquent on credit cards but current on their mortgages slipped to 3.6% from 4.1%.

Delinquencies Continue to Climb in Latest MBA National Delinquency Survey
MBA – 11/19/2009

thankyou!!

Diane

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Hi Diane,

It is possible if it is an account such as a phone bill, or utility bill, or close bank account with a negative balance.  If they weren’t reporting your payments on time every month then they shouldn’t be reporting you as late either.  They are typically geared towards installment account or accounts with revolving balances.

I would recommend you write an effective dispute letter to the bureaus reporting this derogatory and state how it is inaccurate, unverifiable, and I would also recommend stating the particular laws that address your situation, or hire a reputable credit repair company (like mine).

I hope this helps,

Brian C. Aber
Senior Account Executive – HTDI Financial
Charter Board Member – National Association of Credit Services Organizations
brian@htdifinancial.com
877-877-4834 x704

Whether the mortgage company can still report to the credit agencies the lack of payments during the short sale process?

I just received their short sale packet, but I am unable to pay. Can I dispute it if they put something on my credit report? I will be doing the QWR letter, but what about after they respond to it?

Thank you Paul!
God bless you!
Michelle 

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Hi Michelle,

The mortgage company can report the missed payments to the bureau during the short sale process.  The Qualified Written Request can temporarily remove the negative reporting for a period of sixty days.

Read: Mortgage Payment Posted Wrong

Thanks for the questions and hope this helps.

Paul

This author is not an attorney and this information should not be considered legal advice.  Please consult an attorney for legal advice.

I’ve been renting a house for about 8 years and for the last 5 years I’ve been paying the property taxes. We heard that you can sometimes get a house by paying the property taxes. Is this true?

Lenore

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Hi Lenore,

That’s true; however, it sounds like you’ve been paying the property taxes on behalf of the owner rather than paying delinquent property taxes through a county tax certificate sale.  If the property has a mortgage then the mortgage holder probably wouldn’t let the property taxes get delinquent enough for auction.

Thanks for the questions and hope this helps.

Paul

Our agent has suggested a short sale.  However, the banks won’t talk to us until we are two months defaulted on the loan. Our credit scores are in the high 700′s.

Do we default on the loan and risk lowering our score to get out from under the house?

Denise

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Hi Denise,

I can’t answer that question for you, because I don’t know your situation.  And even if I did, that would still be a personal decision for each to make. 

Can you afford to make the payments?  Can the property be rented?  Do you have liquid assets?  So many questions…

As a general rule, pulling money out of a retirement account and/or cash advancing credit cards to make the mortgage payments is a (very) bad idea. 

Read: Short Sale & Retirement Accounts, Do You Have To Be Past Due For A Short Sale? & Rachel’s Short Sale

Thanks for the questions and hope this helps.

Paul

Wilfredo

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Hello Wilfredo,

Are you able to begin making payments again?  If so, then you may make an arrangement for the account to be re-aged or settle with the credit card company with a not-frequently-advertised hardship program. 

If you do nothing, then the credit card company will eventually (if they haven’t already) assign the account to a debt collector or sell to a junk debt buyer with which they may seek to pursue the defaulted loan balance through the court and obtain a judgment against you.  With a judgment it may be possible to garnish wages, levy a bank account, and/or attach other assets depending on state law and your circumstances.

The longer you wait, the worse it is for your credit report; but, the prospects of settling the debt for a lower percentage increase after the debt is charged off.

What happens next?  Any or all of the above.

Thanks for the questions and hope this helps.

Paul

This author is not an attorney and this information should not be considered legal advice. Please consult an attorney for legal advice.

I am beginning the process of obtaining a mortgage and pulled my credit reports only to find a car loan on them that I didn’t recognize.  The loan was listed as a joint account with my dad.  I spoke with my father who said that he had opened the account up when I turned 18 to help me build credit.  While I appreciate his thought process I am a bit disturbed about him doing it without my knowing. 

The 36 month loan was paid on time every month except one where it was paid within 30 days.  I’m wondering if having the loan on my report despite the late payment is better than not having a loan on it at all?  Can you please help me figure out if I should leave it on or dispute to have it removed.  Currently my score is 645 but should go up some as I have found a couple of errors.  I have 1 credit card that has been paid on time every month for 8 years and the rest of the information on my report relates to utilities so I don’t have alot of credit built yet.

Thanks in advance.
Lisa

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Hi Lisa,

Read: Credit Report Late Payments….Correct?

I’d say the 30-day late is not causing as much harm as the history is helping.  The tradeline is likely helping your score overall.

Thanks for the questions and hope this helps.

Paul

Michael

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Hello Michael,

The FCRA requires them to be purged automatically.  Since they remain, file a dispute with the CRA to have them removed. 

Read: How long does bad credit remain? 

Thanks for the questions and hope this helps.

Paul