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I close in 3 days and a collection just popped up!! :enter freak out mode:

Valued Member

I close in 3 days and a collection just popped up!! :enter freak out mode:

Soo..all of my stuff was submitted to underwriting for my codition review last week, and we are scheduled to close this Tues (it is Sat right now). Sure enough I get a nice little alert txt AND A NEW COLLECTION ACCOUNT HAS BEEN ADDED!!!!!! I seriously think my heart skipped a beat.. anyways.. of course one of my scores dropped about 17 points.. It is with a company I have actually been paying $100 every two weeks to for a medical bill I acquired when I had my youngest. The amount is for $369 and I can easily pay it off come Monday, but I am in shear panic... since it is Sat, I can neither call the CA or my LO until Monday. I know it is becoming more common for credit refresh, but how soon before closing do they do this? This is a FHA loan, so hopefully they won't pull it? And if it is a soft pull, do collections appear on this? No one has mentioned to me about another credit pull, but I know there is a very good chance of it. I am going to call first thing Monday and find out what the heck it is..I will probably just go ahead and pay it so when I call my LO I can go ahead and tell her I have paid it and hopefully it won't hold up my closing. We currently are staying at my mom's due to closing a week after having to be out of my rental. Now I am terified it's going to wither ruin thing all together or delay. ...ugghhh!!!! Why?!?!?!
Message 1 of 11
10 REPLIES
Established Contributor

Re: I close in 3 days and a collection just popped up!! :enter freak out mode:

If you've already been approved and are closing, there is no reason to pull your credit at this point. I've had several mortgage loans and no pulls after approval. They want to see you through the process.
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Message 2 of 11
Valued Contributor

Re: I close in 3 days and a collection just popped up!! :enter freak out mode:

Yes, pay off the debt immediately.  Make sure you have some proof that it is paid off.

 

I have mixed feelings on this next part.

 

Part of me says don't call the LO and say anything.  Let things go as they will and maybe it won't be discovered.  Ya know, don't rock the boat??

 

On the other hand, be prepared if they do pull credit.  Have a letter of explanation all ready, along with proof it's been paid in full.

 

When we bought two months ago, I had everything ready to do and closed in ten days.  The lender said they were going to pull credit a second time the day before closing "just in case."  It was a conventional loan.  I don't think they pulled credit the second time.

 

Message 3 of 11
Valued Member

Re: I close in 3 days and a collection just popped up!! :enter freak out mode:

I will call first thing Monday morning and pay it.  I am torn on the telling my LO as well.  I don't WAnt them to think I'm hiding it, but then again I dont wanna screw myself. Ugghhh.. so ready for this nightmarish process to be over!! I don't understand why it has to be so frustrating and stressful... but thanks for the comments.. it did make me feel a little better.. I think I have Google the phrase "new collection 3 days before closing" at least 30 times in every way possible.. 

Message 4 of 11
Frequent Contributor

Re: I close in 3 days and a collection just popped up!! :enter freak out mode:

medical collections do not have to be paid of to be approved for an FHA loan.

i would not pay it off nor would i tell your loan officer

if they mention it and require u to pay it off then do as threy say

Message 5 of 11
Moderator

Re: I close in 3 days and a collection just popped up!! :enter freak out mode:


sports1965 wrote:

medical collections do not have to be paid of to be approved for an FHA loan.

i would not pay it off nor would i tell your loan officer

if they mention it and require u to pay it off then do as threy say


^^^This. Your collections total less than $2k right? Then let it be for now.

Message 6 of 11
Valued Member

Re: I close in 3 days and a collection just popped up!! :enter freak out mode:

Yes.. I had two old collections on there from my ex husband that I paid and everything when I first applied for the mortgage..but they do not total 2000. I do want to call the CA aND ask them what the heck.. back in June Ameristar bank bought a bunch of bank of America accounts ( including mine) so I am wondering if they never got my updated banking info and so it looked like I just randomly stopped paying it.. they could have at least given me a phone call or a letter instead of reporting it. I have been paying every 2 weeks since feb. I wonder if I called the. They would take it off.... I just don't want to have to wait 7 years for this stupid collection account to fall off..ugghhhh....
Message 7 of 11
Super Contributor

Re: I close in 3 days and a collection just popped up!! :enter freak out mode:

dont panic. i have seen this many times and it didnt hurt the file.

 

some lenders will do a soft pull when the loan is sent to closing dept. some actually pull AFTER signing and before funding.

BUT.... we have a tolerance for such things. we KNOW collections pop up.

 

now, if a new car payment showed up, yer screwed.

 

i would not fret. the lender wants to close the deal too

 

 

Retired Lender
Message 8 of 11
Frequent Contributor

Re: I close in 3 days and a collection just popped up!! :enter freak out mode:

Can't speak for all lenders but we've only pulled credit after the initial for a few reasons-- customer's request, credit report too old (90 days usually, sometimes 120), adding/removing a spouse, etc. If you already have your credit pulled, cross your fingers and don't mention it. The cardinal sin I see is that borrowers give too much info out... don't share it if we don't ask for it!! Let the lender do their due diligence and never lie, but don't volunteer info that isn't being requested.

 

If they find out, you can usually pay it at the closing table (must be with your own funds though, not from loan proceeds). Good luck.

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Message 9 of 11
Valued Member

Re: I close in 3 days and a collection just popped up!! :enter freak out mode:

Thank you all for the encouraging words.. file went to final underwriting today so hoping for a clear to close very soon.. or more conditions.. but hopefully no more.. I feel like the only thing I haven't submitted blood and urine samples.. 

Message 10 of 11