I know mortgage scores do not have such a drastic effect on rates on FHA loans compared to conventional. My question for the loan officers out there... my current mid score is around 660. I will be going FHA at the beginning of the year. I can pay down some credit card debt (my current overall utilization is around 50%) and get my score up to around 680. Would that get me a lower rate or benefit me in any way? I'm fine on DTI with my current balances and would prefer to save some of that cash for furnishing the house after closing but if putting it towards CC debt will help, I might be willing to do it.
I'm not a LO, I'm a Realtor. IMO, at 660 you are fine for an FHA loan. Keep the extra cash. There is no benefit to getting a higher score unless you want to go conventional.
Each lender's pricing algorithm is a little different, so it can't hurt to get a quote at 660 vs. 680 from your local lender. Most likely it will make more sense to keep the cash.
