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mackandblues
Posts: 6
Registered: ‎07-26-2012
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Collection from a hospital
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‎07-26-2012 01:41 PM

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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Super Contributor
pizzadude
Posts: 9,668
Registered: ‎01-28-2010
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Re: Collection from a hospital
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‎07-26-2012 01:45 PM

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

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

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
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Senior Contributor
Booner72
Posts: 3,889
Registered: ‎05-24-2011
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Re: Collection from a hospital
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‎07-26-2012 05:12 PM

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.
STARTING: 11/24/10 EQ-584 EXP-648 TU04-595
CLOSED FIRST HOME 8/19/11 EQ-630 EXP-691 TU04-653
CURRENT: EQ-701 EXP-??? TU08-720
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Super Contributor
DallasLoanGuy
Posts: 7,915
Registered: ‎07-03-2007
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Re: Collection from a hospital
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‎07-26-2012 06:11 PM

pizzadude wrote:
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

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

 

 

wrong

 

 

* While I try to visit the forum often, please feel free to contact me directly with a link to your post if I fail to answer a follow up question.

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Super Contributor
DallasLoanGuy
Posts: 7,915
Registered: ‎07-03-2007
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Re: Collection from a hospital
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‎07-26-2012 06:12 PM

how old is the medical collection?

 

i have seen files close with large collections.

 

 

* While I try to visit the forum often, please feel free to contact me directly with a link to your post if I fail to answer a follow up question.

* Lending across the entire 'Great State of Texas' (and now Louisiana)since 2004

* The Loan Officer who you can call anytime... and answers your questions Nights & Weekends

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