Which accounts should I pay off first?

[SouthJamaica]

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@me12345 wrote:

ALWAYS, ALWAYS, ALWAYS ask your MLO first, nobody on these boards knows the details of your situation more then your loan officer....what you do may help, or hinder your chances of closing on your loan.

I see this way too often, ask your loan officer first, if you don't have one, get one first.

Thanks,

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With all due respect, I've seen many instances on this board where people got advice from their loan officer which was not good advice.

[me12345]

Likewise with the posts on these forms....

All I'm saying is that the MLO will have ALL of the details, and the specifics regarding an individuals situation.

What may be great advice for one person, may be detrimental to another given that each has a different situation.

Thanks,

[Anonymous]

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@CreditInspired wrote:
I agree that paying down/off CCs is a great idea. However, IMHO, I think you should ask your lender about this before moving forward. This way, there will be no questions about where these extra funds came from unless these funds were already noted when you first applied for the mortgage. Just my 2 cents.

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I think the first person to raise the idea of keeping the loan officer in the loop is right on target.  Notice that it's specifically in the context of the LO knowing about where the extra funds came from.

Regardless, keeping all stakeholders in the loop (and getting buy-in) seems like it is indisputably a good thing to do.

What SouthJ may be driving at (and here I would agree) is that the LO, simply by being virtue of being an LO, does not thereby become a reliable source of information about how FICO scores work.  SJ and I have seen lots of posts where people have been advised by their LO to (a) pay all cards to $0 or (b) keep all cards showing a small balance, when in fact either of those will without question harm the person's mortgage score. 

So I'd say that the best answer is to keep all parties apprised of steps the borrower is thinking about taking (whether the LO or the people advising the borrower here) and if there is conflicting advice pause and figure out the disconnect before taking any action.

[me12345]

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@Anonymous wrote:

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@CreditInspired wrote:
I agree that paying down/off CCs is a great idea. However, IMHO, I think you should ask your lender about this before moving forward. This way, there will be no questions about where these extra funds came from unless these funds were already noted when you first applied for the mortgage. Just my 2 cents.

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I think the first person to raise the idea of keeping the loan officer in the loop is right on target.  Notice that it's specifically in the context of the LO knowing about where the extra funds came from.

Regardless, keeping all stakeholders in the loop (and getting buy-in) seems like it is indisputably a good thing to do.

What SouthJ may be driving at (and here I would agree) is that the LO, simply by being virtue of being an LO, does not thereby become a reliable source of information about how FICO scores work.  SJ and I have seen lots of posts where people have been advised by their LO to (a) pay all cards to $0 or (b) keep all cards showing a small balance, when in fact either of those will without question harm the person's mortgage score. 

So I'd say that the best answer is to keep all parties apprised of steps the borrower is thinking about taking (whether the LO or the people advising the borrower here) and if there is conflicting advice pause and figure out the disconnect before taking any action.

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Agreed...