Is credit score a big factor in your first investment purchase?

[Ana Masifilo]

Hi everyone 👋🏻

I have been working on my personal finances lately, and I have consolidated some credit card debt within the past couple months. I still have two credit cards pending that’s scheduled to be paid off at the end of March. With what I’ve paid off so far, I was hoping my credit score would Sky rocket, but sadly the increase to my credit score was subtle. (+21 points)

Would it be best to have a credit score at 800+ with a low debt to income ratio and apply for a FHA loan OR apply for a FHA loan with my credit score as is and still have a low debt to income ratio (I still plan to pay off the last two credit cards) Also, my current credit score is in the early 700's.

I am looking to make a purchase for my first income property within the year (by January) either long distance or within Sacramento, CA.

Thank you all in advance! 

[Derek Harris]

Originally posted by @Ana Masifilo:

Hi everyone 👋🏻

I have been working on my personal finances lately, and I have consolidated some credit card debt within the past couple months. I still have two credit cards pending that’s scheduled to be paid off at the end of March. With what I’ve paid off so far, I was hoping my credit score would Sky rocket, but sadly the increase to my credit score was subtle. (+21 points)

Would it be best to have a credit score at 800+ with a low debt to income ratio and apply for a FHA loan OR apply for a FHA loan with my credit score as is and still have a low debt to income ratio (I still plan to pay off the last two credit cards) Also, my current credit score is in the early 700's.

I am looking to make a purchase for my first income property within the year (by January) either long distance or within Sacramento, CA.

Thank you all in advance! 

Ana, if your DTI ratio is within tolerance and you are applying for an FHA loan then I would take action now. First, I would talk to your lender and see if you currently qualify for the lowest interest rate. Try not to have them pull your credit, if at all possible.