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New credit to build score?

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New credit to build score?

Long story short. 

DW and I are ready to buy a home. Down payment saved, emergency funds been there for a while, built credit to a respectable level. Everything we need to move forward. 
Then DW has a collection hit despite it being paid 2 weeks prior to even reporting to bureaus -57pts lost. My auto loan just got paid off and will drop my average credit age by 3 years almost down to 3 years total I think - so likely I will take a hit too. 


Anyway, we've saved enough to buy a toy that we've been wanting forever to take some stress out of life and enjoy a bit. Was going to be a cash purchase, but now I'm not sure.


Would financing a portion and using the cash we'd saved to pay it down help us or be detrimental to our scores? 
I know normally no new credit leading up to mortgage app. but we don't really use credit, we have a skinny file. 2 CC, 1 auto and that's it now that my truck is paid for.


Thanks for any insight..

Established Contributor

Re: New credit to build score?

The paid off auto loan will stay on your reports for 10 years as a positive trade line ( if there were no lates). You may see a small decrease from credit mix, if that was your only loan. Is your name on the loan for your DW auto? Everything I’ve seen says not to app for anything 12 months prior to mortgage. That would give you a hard pull and a drop in age of accounts.

Starting Fico Scores:November 2019

Current Fico Scores: January 6, 2021
Goal Scores: 700 across all three
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