Mortgage Loans

[mackandblues]

My goal is to purchase a home in about a year after I increase my credit score from 554.  However I've been reading that you need to have closed collection accounts inorder to be approved for a loan.  I have a collection of $10k from a hospital, do I need to pay that off before pursuing a mortage?  Thanks in advance

[pizzadude]

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mackandblues wrote:

My goal is to purchase a home in about a year after I increase my credit score from 554.  However I've been reading that you need to have closed collection accounts inorder to be approved for a loan.  I have a collection of $10k from a hospital, do I need to pay that off before pursuing a mortage?  Thanks in advance

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You'll very likely have to pay the collection as a condition of being approved, unless the collection doesn't belong to you.

[Booner72]

Because that collection is so large, and because it could turn ito a judgment and you could be sued ( and then the judgment would be on your house ) - no lender will approve you as they need to be in "first position" if you default on the house payments.

There are way to deal with medical collections - arranging to pay a percentage, "PFD" which means Pay for Delete, or you can google "HIPAA MEDICAL COLLECTIONS" which explains a process to go about removal, though it requires payment.

Good Luck.

[DallasLoanGuy]

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pizzadude wrote:

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mackandblues wrote:

My goal is to purchase a home in about a year after I increase my credit score from 554.  However I've been reading that you need to have closed collection accounts inorder to be approved for a loan.  I have a collection of $10k from a hospital, do I need to pay that off before pursuing a mortage?  Thanks in advance

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You'll very likely have to pay the collection as a condition of being approved, unless the collection doesn't belong to you.

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wrong

[DallasLoanGuy]

how old is the medical collection?

i have seen files close with large collections.