Paying Chargeoffs Suggestions and Impact to Score

[in4maous]

I just applied for a mortgage and the broker sent me a few things to work on and they were to  reduce my credit card debt and the other is to get rid of 2 chargeoffs from. One is from US Bank $2,000 and the other is from Merrick $1,000. These accounts have not been sold to a collector.  My question is I need a plan of attack.  Do I call and ask to pay in full or should I write a letter?  Time is of the essence and I will do whatever is faster.  Also, after paying off these chargeoffs will my score drop or increase?  My current mortgage scores are 670, 659 and 640.

[gdale6]

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@in4maous wrote:

I just applied for a mortgage and the broker sent me a few things to work on and they were to  reduce my credit card debt and the other is to get rid of 2 chargeoffs from. One is from US Bank $2,000 and the other is from Merrick $1,000. These accounts have not been sold to a collector.  My question is I need a plan of attack.  Do I call and ask to pay in full or should I write a letter?  Time is of the essence and I will do whatever is faster.  Also, after paying off these chargeoffs will my score drop or increase?  My current mortgage scores are 670, 659 and 640.

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Call them and work out a settlement, do it by phone, if they find out about your mortgage pulls it will be the full freight with no possibility of settlement offer. Yes they were auto notified of the mortgage pulls they always are. If they are updating monthly once they stop updating and begin to age then your Fico begins to recover. If they have not been updating monthly then there is likely going to be a drop of some sort but with the utilization coming to zero it may even offset to current scores.

[in4maous]

They currently update monthly.  So, once they stop updating I should see my score increase?

[gdale6]

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@in4maous wrote:

They currently update monthly.  So, once they stop updating I should see my score increase?

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Over time yes as Fico scores you based on last status update date not the date they really happened.

[in4maous]

What's the best plan of action to pay in full or 50% settlement?  And how should i broker the conversation

[Anonymous]

Since they will not delete and it will stay on your report whether you PIF or settle, I personally would try to go as low as possible to settle. In this case a CO is a CO whether it's PIF or settled for less than the full balance. While PIF certainly looks better on paper, it's not going to change your approval odds. 

Once the CO is paid, it will take about 60 days for the report to update to $0. After that, they cease to update regularly and your score will gradually improve and not be held under as much. 

[House2021]

I just had one of my theee remaining charge offs report as paid, it brought my Transunion ion score up 6 points, did nothing at all for my Experian mortgage score. 

[in4maous]

That is a funny coincidence. My TU increased 6 pts also and EX Mortgage didn't blink.  Now that my account is PIF shouldn't the OC or CRA remove May 2021 CO from my report or its legal for them to still report it?