Settling charge offs to decrease credit utilization
Hi,
I have been working on rebuilding my credit and my partner and I are in a situation where the house we live in is being sold in the next 6 months. We are in a position, financially, to purchase a house. But my credit may be a limiting factor on us qualifying for a mortgage.
Credit Karma reports my TransUnion and equifax at around 530 but I know CK uses a different score method than most lenders. Experian shows my FICO 8 as 607 after their Experian boost.
My partner’s scores are mid-600s.
Looking for a quick boost to try to get qualified for a mortgage —
I have 2 charge-offs on my report:
- One joint credit card with my partner that has a $1,383 balance with 99% utilization.
- One old discover card with a $4,273 balance with 122% utilization.
My only other credit card is a $1,000 limit capital one that I just got and am planning on using ~$50 per month and paying off the balance. Other accounts are ~$13k in student loans.
After reading the utilization FAQ and other posts, I know that it is a snapshot metric. So does that mean if I bring down my utilization by settling these accounts, my score will go up in the short term?
Any other advice welcome, thank you for reading