Re: FHA Qualifying Chances and CA Settlement reporting importance
01-20-2013 06:04 PM
What are your positive tradelines?
How old are your positive tradelines?
The present information you gave you would qualify, except you still need to see if paying the collection brought your score down. I would wait until reports update and see if your scores were impacted. If they stayed above 640 you still would be fine to qualify depending on other credit information needed from positive, open tradelines.
I have Cap1 MC opened in Oct 2011. I use it for online purchases only and pay off the balance 1 or more times a month.. It's utilization % is probably hurting my TU score though. I used it a bunch in late December (after paying the balance) so it was at 26% when I pulled my last TU report.
I also have an old car loan that EQ reports and TU doesn't. It was started in Sep 2000, no lates during the 5 year auto loan.
No other accounts open though. I didn't want any new applications/inquiries because of how quickly I thought I'd be applying for a home loan.
Also, no lates on any accounts in 4+ years (excluding the CA).
And I'm actually hoping paying the collection settlement improves my scores. This CA is reporting all balance increases (from interest) once or twice a month. Granted I haven't done a ton of research on the topic, but I have always assumed that in almost all cases Settled in Full has a better impact than an unpaid collection. I thought when it came to CA reporting statuses the following is true: No TL > Paid in Full > Settled in Full > Unpaid/Late. (Granted I believe for CA TLs that
TL Deletion is much better than Paid in Full, Paid in Full is moderately better than Settled in Full, and Settled in Full is moderately better than Unpaid/Late.)
Why would "Settled in Full" hurt my score more than not paying it? That seems very illogical to me and I don't process illogical things well at all.