Is this true about FHA

[Lil Smurfette]

Hello,

I was told by my lender that FHA loans are not score driven. Is this true information? Also, I have some unpaid charge offs on my credit report that are less than twelve months old; if I pay these charge offs by settling with the CA's, will this help my credit or totally damage the little I have left. :cry:

[firstsource]

I would suggest that you contact the creditors and see how much they will take and still report to the bureaus as "paid collection accounts". Of course get that in writing prior to sending them the payment.

FHA is credit history driven, not score driven. They look at your history and don't score things.

Charles

[Lil Smurfette]

Charles, so you think that if I just make sure that I pay off the three smallest charge offs. And do the monthly payment on the large one that would be fine with FHA.

These are the four charge offs:

Providian Visa - $CL 1,800, BAL - $2760; will settle for a lump payment of $1,500 or I can set up monthly payments with them until the full balance is paid.

Providian Master - CL - $500, BAL - $1,356; have not got in touch with anyone regarding this account yet.

Department Store card - CL - $300, BAL - $477;will settle for $286.00

CRAP 1 - CL $200, BAL - $725; will settle at $365.00.

I am in the position to pay three out of four of the bills to get them out of the way. We are planning to buy by October. So, I will do what I need to get these accounts taken care of.

Question? Do you have to pay the accounts in full or is a settlement okay.

[firstsource]

Long term your credit will be much better if you paid them in full, just get the creditors to agree with you in writing, that if you do pay them in full that they will remove the collection indication. If not, then next best thing is to pay them a partial amount, if they will agree to report to the bureaus "paid collection". Don't settle with them if it is going to be reported as a settled account.

Charles

[Lil Smurfette]

Charles, I'm getting a little confuse here.
The four charge offs that I have are not reporting under the CA's as of yet. It shows under the OC's, but the CA's are the only people I can talk to. One of the CA's said that it will be reported as paid settlement. The other CA said it would be reported as paid in full.

So, if it is currently showing on my credit report as Charged Off. How do you think it will report. Settled Charge Off or Paid in full Charge Off. Are will they completely take off the Charge Off part on my credit file. Either way will FHA approve me still you think. :?

[firstsource]

If you pay a charge off account and get it to be reported as a "paid collection" account, you will be much better off, short and long term.

I think you will be able to get an FHA loan.

Charles

Try negotiating for a deletion or removal of the negative tradeline entries with the original creditor before you settle for a "Paid Charge Off".