Howdy all,
I've been doing some research on the board and decided to finally ask a couple of questions. My wife and I are looking to apply for a mortgage pretty soon (within 3 months) and I recently received a settlement offer from Enhanced Recovery Solutions (ERS) to pay off an old AT&T account. The account was originally charged off in 2006 and was appearing as on old collection on my report. In Feb. 2011, ERS reported this as a new collection dropping my Equifax score by 32 points- went from 640 to 608. The offer states once payment has been received and cleared, they will report the account as paid and closed. Balance reporting on the credit report is $260, settlement offer is $121.
My score has increased back to 637 equifax since then and my other two are at 650 and 648 (ficos). The balance is so small, I'd be willing to pay the entire thing, however have not done so as I'm not sure what effect this will have on my scores. Our current DTI is at 23% and the home we are looking at is valued at $180k. Wife's scores are higher, so mainly concerned with mine.
Well, I did not actually ask any questions, so your thoughts on paying the delinquency and anything additional would be appreciated. I should note- there are 2 other accounts that are listed as old collections- both credit cards one with a $2000 balance charged off in 2005 and the other a $650 charge off in 2006.
