Credit Questions Answered

Will Your Credit Score Improve If You Pay Off Delinquent Accounts?

When accounts are not paid on time or go unpaid, it is reflected in your credit score.

A common misunderstanding is that if you pay off these delinquent accounts, your credit score will be restored to what it was prior to becoming delinquent on these accounts. Unfortunately, that is not how the credit bureaus operate.

Your credit score suffers not because the accounts are in and of themselves delinquent but because you ever had a delinquent. Therefore, getting rid of the evidence, so to speak, doesn't erase the fact that you were delinquent on an account.

Only the passage of time and a history of on-time payments erases the damage done by having delinquent accounts.

So, the answer to this is "Yes", but the rest of the answer is two-fold: Pay off delinquencies but then wait it out.

Can These Two Items Be Considered Together But Separate - Income and Credit ?

"Huh?, " you may be asking.

Believe it or not, this question is asked all of the time. You may have wondered it in the past or may be wondering about it right now.

It is most likely a couple who are looking to purchase a home. One has a great employment and income history, and the other has a great credit score. Neither potential borrower has both great employment and a great credit score.

The answer is "No". A borrower with excellent credit who cannot demonstrate the ability to pay the mortgage being asked for is of no use. Your employment / income and credit history cannot be separated.