Can I get approved with this? (USDA)

[Anonymous]

If my score is over 640 - but I have two collection marks less than 12 months old - BUT it's paid in full and shows zero - can I still get a USDA loan? The reason is because I didn't have my insurance card at the time I went to the hospital and forgot to call in with the insurance info later. I didn't realize and it went to collections so I just paid it off myself. 

Thanks for any info!

[cartwrna]

You do realize the hospital could have billed your insurance, and the collections would have been removed right? As far as a USDA loan with two recent collections I would say no. Here is a link to USDA underwriting guidelines. It states any accounts converted to collections within the past 12 months is non acceptable credit history. I would work on having them removed, or wait out the 12 months. http://www.rd.usda.gov/files/CA-SFHUnderwritingGuide.pdf

[Anonymous]

The hospital told me since it's gone to collections there is nothing they can do about it because they sold it off to a collection agency.  

And okay thank you for the info. 

[cartwrna]

Weird. Usually they don't sell it off for awhile. My wife had 2 bills we missed that were 6 months old we just paid, they never made it to collection. Different hospitals I guess. I would of asked for a PFD (pay for delete).

[Anonymous]

This could depend on if you are doing a direct loan or a guaranteed. With a direct loan, they overlook pretty much anything if you have three trade lines and a score of 640. I was over the 640, but only had two open lines of credit. They did not include a paid off auto loan. 

I had two collections that showed up on my credit report. Both were open at the time. One of them was not my debt. It stated the account had been opened about 20 years before I was born. I contacted the company and had to get a letter from the utility company stating that I didn't owe them anything. The other collect was one that six years old. I had been told by the company they would not try to collected because of the amount (<$400) and the age of the debt. The USDA didn't care that the company said they would not pursue it. I had to pay it. Then I had to write a statement that said I had paid it and that I had been unaware of the debt prior to having my credit pulled. 

I'm telling you this to say that even if you have collections, we can still get approved. I'm sitting in the house that I bought less than 3 months after paying that collection. If I didn't have to wait 60 days for an appraisal, I would have been able to buy the place even sooner. 

Good luck! Don't be discouraged.