Pay down debt to improve credit or use money to purchase propert?

Question

My credit score is low 590 I saved 7k and should be at 15k in 3 months ,why is the best approach? Am I able to purchase anything with subpar credit?

Account Closed · Answer

2 months ago I would have told you that FHA would be able to provide high LTV financing with a 590 score with good explanation letters, but covid has caused many investors to be more strict.  Best tip I could give as far as improving credit is to watch your credit balances compared to high credit. If your balances are near their max, your score will get hit. Try and keep balances no more than 50% of high credit.

Chris Winslow · Answer

If you are carrying a lot of high-interest debt, it would be a good idea to pay that down first in my opinion. If you have only lower interest debt (less than ~5%), I would focus more on saving and investing but it will depend on what you are comfortable with.

Definitely a different situation with the current state of the world but normally it is possible to get loans with a credit score like that but they will likely be more expensive and more difficult. If you focus on making moves to improve your credit it will improve it'll just take a while.