580 score, trying to get mortgage

[pchweiss]

Hi there,

Credit scores 631/580/586
12 accounts - defaulted (idk how many in collections)
1 repo - $36,000

3 year old debt

Until a few days ago, I didn't know it was wrong to pay off old debts! I recently got a new job and wanted to start paying off charged off accounts and have done so! Unfortunately, this made my debt current and probably is going to lower my score.

I want to get a mortgage here in the next few months!

1. Would it be a good idea to try and get a BofA secured card? Do you think I would qualify?

2. Do you think a debt company can help my situation given that I have pretty much paid off everything and didn't know you have to pre-negotiate a pay-for-delete?

3. Would a debt company be able to remove debts that I have recently paid off?

Thanks in advance for any and all your advice!

[Hal Jordan]

If you have no credit right now a secured card would be a good way to go. Make sure you use it every month and pay off your balance every month. You will want your debt to credit ratio under 30% to receive optimal points.

Now wrt to the other stuff. The only way you ever pay a collection agency is to pay for delete or you lose to them in court. Never every pay a collection agency unless they'll remove the debt permanantly and do so in writing.

Read the beginners section and the FAQ for newbees.

Good luck.

[Flypilot]

Orchard Bank has a good secured card. it does not say secured on your credit report either. You pay a deposit of say $500 and they give you a card with that limit. After 12 months of on time pmt's, they will send you back your deposit. At least that's the way they did it 7 years ago.

Chane should actually sign up as an affiliate and post their banner on here

Fly

[Lian]

If you paid the debt in order to obtain mortgage approval in the near future, then I don't think you necessarily did the wrong thing.

PFD offers before payment have no guarantee of acceptance. Entering into the mortgage approval process with unpaid bad debt will almost always result in the mortgage lender stipulating that it must be paid as a condition for approval.

You most likely would have had to pay it at that time. You may look better in the eyes of the lender having taken care of it beforehand.

Sure, without a PFD, you wont get score improvement. But mortgage approval is not just about your FICO score.