I’m trying to qualify for a home loan and I’m working with a lender to improve my credit score. Right now, it is 611, which is enough to qualify for an FHA, but at a lower amount. If I can get it over 640, I can either qualify for a USDA or a higher loan amount with FHA. I know I can pay down my credit card balances and it will help some, but I don’t think it will put me where I need to be. My question is what kind of impact my old collections are having on my credit. Two are from Midland and one is from Calvary Portfolio. They are several years old, about five years I think, but they are updated monthly with increases due to interest. Will that have a bigger impact on my credit than if they were just reported once like most collections accounts are? Also, I know Midland won’t do a PFD, but does anyone know if Calvary will or if they will accept a lesser amount with a PFD.
Also, will paying it off help my credit score because they won’t be updating it anymore? I know marking an account as paid won’t impact it but I thought that not having i reported monthly might help my cause in time.
Any help is appreciated.