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Hi, All.
I'm new to the forum and have recieved a wealth of information just by exploring the community.
My husband and I are looking at purchasing a home in the future (6-12 months hopefully); his credit score is fine (above the 640 benchmark), mine is bringing us down. I'm sitting on a 559 (I know, OUCH). The 559 is due to some very stupid financial decisions in college. What's really dragging down my score are collection accounts (credit card charge-offs and medical bills) with a grand total near $2,800. We are hoping to get a USDA loan--the location qualifies and we meet the income requirements for the guarenteed program. I've spoke with a loan officer and a broker, both have said that I need to pay off the collections ASAP. I really don't mind paying a debt that is mine, but I don't want it to negatively effect my credit score. All of the collection accounts were opened 2+ years ago, so I'm worried that by bringing it current my credit score will drop. I've read several posts that others have shared regarding this--most are required to pay off the collections at closing (in order to avoid an adverse effect on their credit score which would cause them to not be approved for the loan). What do I do? The FicoSimulator estimates that my score will be in the 640 range within 6 months just by paying down a significant amount of credit card debt (I hope it's not being overly optimisitc). All advice is appreciated.
I am doing USDA Guaranteed and am wondering why you had to pay off your small collections with such high scores that I read about on a different post that you had?
If that is what your MB requires then by all means do so. I would send PFD to the collections Agencies, I know the task seems daunting but I guarantee you that if they are removed from your report you will see a significant change in your scores. I had collections and one C/O: I PFD the collections and my Experian Score went from the 590s to 646 within one month of them being removed. Good Luck
@Anonymous wrote:
R u talking to me sherakay?
I did direct. With guaranteed it may be different based on what lender you use. my score were 652 670 and 698? So not they are ok but I would say high.
Yeah, I have 690 that I saw on Walmart Fico and other than a dispute that the lender said had to be 'resolved' she didn't say I had to pay it off. They want the full $1445 to do a PFD, and I'm not paying that, cause I don't owe that.
I have to call Experian tomorrow to see about getting that dispute notation removed asap.