Quick Help

[kch21]

I am trying to get approved for a mortgage for $165000. I am also trying to qualify for DPA. I need a middle score of 640. My score right now is 612. I do qualify for a loan and the mortgage lender states in order to qualify for that amount I need to pay off a larger bill to decrease my DTI. I also need my middle score at 649 for the DPA. However, I have been using the snowball method and would like to continue the route I'm going as I will be debt free minus (hopefully) a mortgage and student loans. Mortgage lender suggested to pay off my personal loan or car loan to lower my DTI. 

Car Loan = $396 

Personal Loan = $326

CC = $ 243

BNPL = $162

Could I not just pay off the CC and BNPL and get the same decrease in my DTI and increase my score at the same time as if I just pay my car loan or personal loan off?

[FicoMike0]

I'd think you'd be looking for a cure for Pathological Demand Avoidance.

All seriousness aside, they use min payments to calculate DTI.

I don't know what kind of disease bnpl is, good luck with it.

[Vinjints]

As I understand it, your DTI should just be the total of your monthly required payments, regardless of where they are going to. However, if you did in fact pay off all of your credit card debt, you might see a reduction, or limited increase in scores because of an all-zero penalty. Generally, I think your theory is sound, though. The CC and BNPL are roughly equal to the car note, just depends how much total dollars are needed to pay off each one.

[VAMortgageGuy]

Paying off your CC should give you a bump in your scores, but paying off & closing an installment account could hurt them. 
I have a couple of questions.
1) Do you really need the DPA? The reason I ask is 2 fold. The rate is usually higher on DPA programs & they generally have tighter DTI requirements.

2) Do you have enough money to pay off your CC &/or the debt the LO suggested?

Find out what the max DTI is for the DPA program.