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Repairing credit to obtain mortgage loan


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I would like advice on what steps I should take in order to obtain a mortgage loan in the next year or so. Here are the negatives on my credit report:

Chase Bank Credit Card

Charge off

Balance $10,500

Last payment 2/2011

Fall off Report 10/16

Sent me a 1099-C 1/2014 which I report to IRS with my 2013 taxes

Discover Credit Card

Charge off

Balance $2876

Last Payment 12/2009 Past the SOL (TX is 4 years)

Fall Off report 6/16

Exxon Mobile/Citibank sold to Midland Past SOL

Exxon showing $0 Blance

Midland Showing balance of $2633

I was told by a mortgage lender that all charge off's have to show $0 balance. The lender said I can obtain a mortgage loan with chare off's on my credit report as long as they show $0 balance. Credit score right now is around 610.

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Unless you get these removed or settled you will not be getting a mortgage anytime soon. There is no magic way to do this and once they discover you are working towards getting a mortgage you can bet your last dollar they will dig in their heals on reporting knowing you can't get the mortgage with the balances showing.

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  • 9 months later...

What you need to do is dispute the OC TL's with the specific statement "Balance is inaccurate, should be $0".  Make sure there are no other errors (dates are more recent etc).  with that you should be OK.


For Midland, you are in TX, so send a DV letter based on TFC 392.  (lookup Texas master thread), and hopefully they fail to validate and you have some leverage to get it off. 

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If the Exxon Mobile/CitiBank is truly out of SOL I think you can get Midland to remove its reporting of the account by disputing it. Midland has been known to sue but with SOL up that shouldn't be a problem. Prior to reading more on this site I sent the lengthy DV template letter used all over the internet and they responded with all info required but they didn't provide any documentation or proof of license to collect as requested in the letter. They're not required to provide any of that info but when I responded to them saying they failed to properly validate the debt, they responded with saying they would delete reporting and they ended up deleting the entry.


It's kind of funny because I had 2 negatives from Midland on two different accounts and both entries were removed within 60 days of their receipt of my initial letter. Maybe I just got lucky, but I share this experience because its possible you can get a deletion as a result of Midland's incompetence.

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  • 1 month later...

I have a similar situation. I am in the process of purchasing a house and at the end of almost closing and some old debt appeared. They are out of SOL (I'm in CA) and last payment was made 2010. OC was chase and sold off to Midland. Midland took me to court for another account and I won that case so because of that there is something in their system shows I have an attorney representing me so they cannot speak to me in regards to any accounts unless I lift that order ( I represented myself). Lender said all they needed was to hear Chase say I didn't owe them anything and it was charged off but since they mentioned the collection agency now they need to speak to collection agency. Anyways I don't know what my step is. Lift that order (will that screw me up in any way) so they can verify the account with the lender? Will they somehow remove it from credit report since it's out of SOL? Any input would be greatly appreciated. Thanks

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That Chase TL will be the most difficult to deal with.


Discover may be a good candidate to use arbiration.  Find where the error is in one of your reports and use arb to force Discover to remove the TL or at least wipe the amount owed to $0.


I would not mess with Exxon/Citi since it is already showing a $0 balance.


With Midland, I would follow the advice of @mycorrado using the TX consumer laws.

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