@RESSECUP wrote:
I am trying to qualify for a mortgage. However, i do have credit card bills I need to pay down, However I am questioning what should I focus on. I have some collections that I am currently making payments on.. However, im torn as to whether i should pay the collections off or just focus on getting the credit cards paid off? My initial plan was to settle on my credit cards, however im trying to get licenced at my job and for some reason settling on accounts brings up questions as it has already and ive had to write letters explaning why, but the actual collections that i have not paid off are not causing a red flag. So I want to hold off on settling on the accounts.
So are you actually paying down the collections or is that a plan for the future?
The question is too general to give you any meaningful advice.
It depends on the amount of the collection, the type of collection (student loans or something else), the age of the collection.
It also depends on the type of mortgage you are going for - fha or conventional.
FHA will allow up to a total gross amount of $2000 in collections. But if you are paying down your collections - finish the agreement and then good will the collection off.
On the one's that you have not touched, it would be a good idea to try for pfd (pay for delete). You can get more detailed info in the "Rebuilding your credit" section of MyFICO.
The prior poster is right about getting yourself into the best possible position for a mortgage - it will make the mortgage process much easier on you and make your purchase a pleasure. Going in without resources or a low score can make it a difficult process. But score is not the only thing when you go for a mortgage - LTV and DTI are extremely important. So look at preparing for the mortgage process as an opportunity to get your financial ducks in a row for the long term.
