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Greenenvy1

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Mortgage loan and disputes
Have a FICO 787 had one disputed account last year over a delinquency of 53 dollars, was getting nowhere in resolving paid the 53 plus fees totaled 86 dollars then closed the account. Now applied for a home loan and approval was denied because of disputed status I am stunned, was informed Friday at 5pm by phone have to wait til Monday to get more info and or see an attorney.

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Minor disputes can be major speed bumps

First off, you need to gather all of the facts.  You need to pull full copies of your credit report from the 3 majors (Transunion, Equifax, and Experian) so you know exactly what you're dealing with.  Leverage your favorite online site like freecreditreport(dot)com or go back directly to the agencies as you have a fresh credit denial.  Immediately file a dispute with the reporting agencies for anything that is incorrect on your report.

Contact the company that you settled with and ask them if they have reported the settlment and closure of account.  If not, why not and if so, why isn't it showing up.  Tell them that it is impacting your ability to get new credit and ask them nicely to get the records updated so it hits your credit report.  Ask them if they are willing to write a letter stating that the dispute is resolved and send a copy to yourself and your bank or mortgage broker.

Collect your records about the disputed amount and the fact that you have resolved the issue and go back to your bank or mortgage broker and ask for reconsideration on the existing loan application.  (As opposed to starting a new application)  They should take this information into consideration if you have the documentation to back it up, especially because it is such a small amount.  Reason with your loan officer about the true impact of a dispute of less than $100 and tell them why you disputed it in the first place (false charge, misdirected mail, principal, or whatever).  If they won't reconsider, it's time to take your business elsewhere. 

I avoid banks and credit unions for mortgages.  Their rates are not very competitive and at many institutions the employees don’t have the ability to think for themselves.  It’s not their fault, they are employed to verify information you provide and plug numbers into a computer.  If the computer gives you the thumbs-up, you get the loan.  If the computer gives you the thumbs down, that’s the end of the story.  In my experience, mortgage brokers have always been able to beat the pants off of those traditional institutions.  They are motivated to find you a great loan because they make money off of you closing on a loan. 

Final Thoughts:

I would go down these paths first before employing an attorney.  They are useful in helping to resolve issues if you can’t get it done yourself, but it is costly and may actually make the process longer to get resolved.  Once you employ an attorney to start wrangling the creditor, the creditor will do the same.

Brace for impact.  Once you have this corrected on your credit report, your score will take a hit and maybe a pretty sizeable one.  While there is an active dispute on your credit, those specific items are excluded from your score.  Once the dispute is settled, the delinquency will be factored in (unless you got a deal where the creditor agreed to remove all negative info).  If your 787 score is a true FICO, you're likely to be just fine after the hit.

Good luck, I hope the situation gets resolved quickly.

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