should I pay off the credit cards or the loans?

Posted on Mar 3, 2013 in Stated Income Loans

income vs home loan
by micah rich

Question by Cooter: should I pay off the credit cards or the loans?
I am trying to buy a house. which is more beneficial to pay off first to qualify for the most money from the bank.
I have a couple car loans and a couple credit cards. Say I have a 5000$ credit card and a 5000$ car loan and I have the money to pay one off. Which one should I pay off the get the biggest home loan qualification.

Best answer:

Answer by lost
Pay off what ever has the highest intrest.

What do you think? Answer below!

4avg.rating 21 votes.

4 Comments

  1. don’t pay anything just file bankruptcy.they will renew ur credit from zero.

  2. Pay off the credit cards. The interest rate is probably higher. Also, if the credit card balances are more than 30% of your limit, it hurts your score. Pay off the balances and your score gets a quick boost.

  3. It woudn’t really matter UNLESS that 5k you would be putting towards the credit card would bring that balance below the 30% balance threshold OR paying it completely off. If you are near your limit on your credit card or are carrying a balance that is more than 30% of your limit, you are hurting your credit score, and it would reflect badly on your report.

    I would say the credit card. Most likely, it has a higher interest rate .

    How long do you have left on the car loan? I think in some instances if you have less than a year to pay on the loan, it will not be included in your debt to income ratio.

  4. pay off the credit cards first .