Trying to increase score

My lender is telling me to pay the collection account and check my score in 30 days,I have asked about rapid re-score but can not get an answer. Will rapid re-score work, I have 3 accounts that I'm negotiating settlements on, I'm trying to raise my score from 627 to at least 640 or 660 at best in the next 30 to 45 days, can this be done? I was told that paying collection accounts can hurt more than help,then some say my score may increase, confused on what to do,lender is not very helpful.
  • May 16 2012 - US
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Answers (4)

Tony,

Thanks for your answer, my lender informed me to try to get to 640 for a better rate, what is the solution to paying off collection accounts and not having the score lowered, I am at a cross road,my lender has never done a rapid re-score but they do have a company that does them,is this a good option to look into, I only have 2 collection accounts that total $2770.00.The clock is ticking my pre-approval ends in July.
  • May 17 2012
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If you do pay the collection off and re run your credit, your score will go down.  the credit repositories only see it as recent activity on a collection account.   if a condition of your loan approval is to pay the collection, you can have them paid at closing. 

is your lender telling you that you need a credit score of 640 to qualify?  With a 627 credit score you should be eligible for FHA financing, you might be limited to a certain debt to income ratio and some reserves.  FHA does not always require you to pay off collections either.   i hope this helps.
  • May 17 2012
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There are no accounts in dispute,my 2 other cards are all fine no lates, working on getting the balances down to about 40% of usage, my dilemma 
is that my pre-approval letter states the collection accounts be paid in full,

Have you ever heard of a condition like that?
  • May 17 2012
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Profile picture for Brian GFL Capital
thats a tough question. negotiating a settlement on a collection would show the account is paid, but since it might not be paid in full, that might look bad.

I dont see how paying off a collection is ever a bad thing. since you are not looking for a lot in terms of an increased credit score i would look into settling or paying off the balance on the collections.

30-45 days should be long enough before ordering a rapid re-score.

are there any other accounts that you can look at trying to work on to get the score increased? any accounts in dispute that you can clear up?
  • May 16 2012
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