I have asked this on other forums but this may be a better place to ask...

[Anonymous]

I have a CO that is 6.5 years old; it updates monthly as CO. It also keeps my util at 33%.

I want to purchase a home soon so my dillema is do I pay it to bring down util or will that bring my scores down because it will look as if I have a recent late (new activity)?

Should I leave it alone & wait for it to drop off, I'd like to buy house soon though? I already tried gw they will not budge.

Advice appreciated because I do not want to lower my mid mortgage score which is right at 640.

[Anonymous]

Not sure about others, but I can tell you from first hand experience that most mortgage companies will want anything that is outstanding (negative)  pif.  You would have to wait for this to fall off, since it sounds like a large amount taking up 33% of your ut.  Or pay it.  Mortgage companies want all of your ducks in a row.  

[Anonymous]

It is not a large amount. The original balance is only $200 but now they say I owe $659.

That is all I owe. I have  a few credit cards but only about 1900 in total credit line so 659 makes my util seem high.

I applied for preapproval for mortgage and they said not to worry about paying. They also couldnt tell me how it would affect my score if I did pay or settle it.

[RonM21]

I don't know the exact answer myself but agree with Sandibeach, I think they would prefer you to have it paid down.

[Revelate]

If the CO is reporting monthly it's effectively new every single month.  

Paying it draws the line in the sand, and you can go upward from there.  Short term gain / loss is probably near zero other than revolving utilization (you do have at least a couple of dollars on one card at least?) which is probably a small win, but if you are mortgage qualified and OK with the rate, then go on with life and don't sweat it.

If you need more points either now or in the semi-near future then pay it.  I'm not entirely sure when your CO is going to get excluded, lates typically get dropped at the 7 year mark but if you have a CO reported every month in the tradeline data, ugh.  CO's suck btw as they report seriously unfriendly.  If the mortgage wasn't in play I'd simply tell you to pay it immediately since it's "not a lot of money" as you termed it, but if both you and the lender are OK with the CO and you're trying to move on the house now, then simply sort it later.  You absolutely want it paid if not deleted though, at least get the negative aging utilization metrics notwithstanding.

[p-]

Have you tried a PFD?

[Anonymous]

I have tried a pfd. I even offered to pay in full

[RobertEG]

When you say that the CO is 6.5 years old, on what date are you basing that age?

Is it currently 6.5 years from the DOFD, or are you using the date that they reported the charge-off?

[Anonymous]

Dofd. Reports say due to fall off Dec. 2016