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lisawilly

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Buying A New Home- Is it better to pay off credit cards before buying a new home or other bills
Should we pay off 2 credit cards, or pay off a second mortgage and auto loan, or should we just keep the cash, before buying a new home?

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It depends on your debt-to-income ratio and on what your FICO score is right now.  Most lenders in TX are looking for a minimum of 640 median FICO score.  If your is lower than that, you need to make sure you have no past due bills, no outstanding collection accounts, your credit card utilization is below 30% (1-3% utilization is best).  If your debt-to-income ratio is poor, then pay down loans.  If your FICO score is higher than 640, and your debt-to-income ratio is good, then put the money towards down payment.  You can purchase your FICO scores at www.myfico.com.  Best of luck!

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