Collections and Charge offs

[SSH0126]

Do you need to pay all collectiosn before applying for a mortgage? I know the best thing to do would be to PFD. However I was told that you should pay the last two years of collections. To offer a PFD and then if denied offer to settle. I know that you should keep attempting but when you get no kind of response from 100% PFD offers..nothing else could be done...

Lastyly, 

Is it really neccessary to pay all collections off on credit..anyone experience anything different?? Or do charge offs and collection just need to show balance of $0.00

Thanks in advance 

We are looking to do a VA loan. 

[SSH0126]

anyone 

[basballguy]

it depends on your credit score, loan program, and the collections/CO amount, lender, etc.

I've "heard" FHA requires all amounts over 1k to be paid.  I'm sure its documented as well.  Not sure what the rule is on charge offs.  Medical collections are treated differently.

[SSH0126]

62-640 credit score va loan amount of collections are of various sizes

[boomhower]

It's going to depend on the loan program and even the individual lender.  FHA has implemented at policy of collections over $1k must be paid.  There are some caveates to that though.  Just punch it in google and you can read that part of the policy yourself and see how your will be affected.  Lenders can have stricter policies though.  I had a $2.5k unpaid collection that I did not have to pay, lender was Wells Fargo.  Essentially what they are looking for is whether the item is likely to cause a lean to be placed against the home.  The underwriter wants to ensure there won't be anything down the line that can cause the bank not to be paid. 

[cygnusdrache]

basballguy - You said medical collections are treated differently...  in what way?