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sjb88

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Impact of 180 day late from 5.5 years ago?
The 180 day late was for a student loan that I thought was still in forbearance from ACS. I didn't update my address with them and didn't get the notices. I never checked my credit back then, young and naive. I immediately paid the payment when I saw the 180 day late, which is a mistake now that I think of it as they would have granted a forbearance and retroactively removed the 180 day late from what my University finance office said.

I want to purchase a home in a year but am worried about the impact of this 180 day late. No late payments in 5.5 years since and active on time payments on all my cards . Credit karma shows a 756 score if I pay down my balances of about which I can do.

No late payments in the past 5.5 years and in a years time it'll be 6.5 years. If I pay down my balance. Is this 180 day late having a major impact on my score or is it the fact that lenders will see it that is more of an issue or both?

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DO NOT TRUST THE SIMULATOR!

There is some impact,  but nobody can say how much.  Time will tell when it roll's off your Credit Report. 

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First off I would say it is not having much of an affect on your score.  You have a very decent score that should qualify you for most loans, including a mortgage.

Next year when you apply for a home loan it will still be there, and waiting the half year might make you a bit more attractive to the underwrighters.  but in all honesty I do not think it will be that much of an issue. Apply when you are ready, and at most the underwriter will request a letter explaining why that is on your report.

When you start looking for home lender, be sure to have a few or at least two companies putting you through the approval process.  The hard hits on your credit inquireies will only be seen as one if you are making a big purchase and they are within a couple/few weeks of each other.  By having a couple of companies give you approval you are getting to see the different interest rates they will offer as well as have a backup incase you hit up against a tough underwriter.

Be sure to read about what lenders expect for income to debt ratios, so you can have a good idea of what you need to pay down for current credit cards and loans, as well as how much you will need for a down payment and how much of a house you can look for.

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