First time home loan questions


LoanSafe Member
Aug 20, 2019
So I have a personalized and interesting situation going on which im seeking advice for. First I'll give a litte background on myself and the situations that have lead up to this moment.

When I was young and boneheaded, I started out with credit cards and bills I could not afford. This continued until I buried myself in debt. Now, the debt I have is in collections (I believe the total is around 2800) and my credit has taken a hit to the point where I can no longer get any sort of personal loan or credit cards without it being a secured loan. I have no assets of value and not a ton of money I could put up as collateral. I do make somewhat nice money, but with bad credit, that only goes so far. I just got married and we are looking to buy our first home together but I'm not sure where to turn, or what options I have in my corner.

Now, onto the question at hand. Is it worth paying off my old collections debt with some of my saved money/wedding money? or should I focus more on saving up a good down payment for a FHL loan? It will take another 5 years for my collections and bad credit to drop off. Even if I do pay off the collections, from what I've been told it wont necessarily change my score for the better. So i guess I'm stuck trying to figure out where to go next.

Any assistance or recommendations is greatly appreciated!


LoanSafe Member
Jun 20, 2017
If you make "somewhat nice money", why are you dragging your feet on a $2800 debt? That is nothing. Pay if off and move on.

How badly do you want a home? You seriously cant be waiting 5 more years to simply have this debt drop off your credit report to buy a house.

More details are needed to give you any kind of direction:

What exactly is "somewhat nice money". Just give us a ballpark figure on yearly salary.

What do houses sell for in your area?

What other debts do you currently have? Rent? Car payment?

Does your wife work? If your credit score is low, get the mortgage in her name or use both incomes to qualify for a loan.

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
Jan 14, 2011
San Diego, California
I do NOT suggest paying off a collection unless they are going to delete the item from your credit report. If you pay off a collection it could actually damage your credit instead of help depending upon how old it is. Once you pay it, it's going to re-report and it's like as if a new derogatory item pops up (in most cases).

When it comes to home loans for people with bad or lack of credit history you first want to get yourself off the fence and apply for a home loan with someone that isn't going to just ditch you once they pull your credit. You need someone with access to tools like a credit simulator and rapid rescore system. Many loan officers have access to these tools but are not willing to run them and would rather move onto the next person because let's face it, we don't get paid on loans we don't close. I personally would be happy to help you and let you know what you need to do to qualify whether it's now or in the near future.

Here's what I would do first with you - have you apply online here: - once you've done that I can pull credit (see what it is) and if needed run the simulator to see what you need to do to improve it. You mentioned that you can't get any credit cards unless they're secured. Sometimes secured credit cards are what you need in order to get a higher credit score and fast - I can simulate that. I had a good friend of mine get access to a down payment assistance program and boost his score from a 560 to a 680 just by literally getting a secured card.

As mentioned above, you really just have to start somewhere and I would be happy to help with that. I'm licensed in just about every state in the country and have worked here within the LoanSafe community for a very, very long time. Feel free to contact me here: 619-379-8999 or [email protected]. You can't have better timing, the rates are great right now.