Major downsides to applying now for info & weed out any future dings on my CR

[Anonymous]

There is nothing more I want right now than to buy a house. However, I know I am not yet ready, score wise.

I have read of others applying just to see how far off they really are, and because once you have a mortgage inquiry, you may end up with some unwanted items on your report.

What is the downside of doing this, other than the inquiry?

I have a repo from 07 and that is my main concern.  I want to see what the likelihood of it having to be paid is. 

My current scores are around 600, and I know that I meet all other qualifications. So I am hoping by the first part of the year, I will be good to go.  But if I have to pay off the repo, it would mess up my timeline.

Any ideas/comments?

[gagum129]

From what I have read usually any collections usually have to be paid prior to closing. In some situations you can get by without having to pay medical collections but I think that is about it.

[Anonymous]

Ugh. That is not what I was hoping.  It's like $9k

Maybe they will settle for a small percentage!

[drkaje]

Get an approval with a recent unattended negative would seem difficult.

[Anonymous]

But that is my question...what is considered recent? It will be over 5 years.  With perfect credit in last 4 years. Still no dice?

[Walt_K]

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@Anonymous wrote:

But that is my question...what is considered recent? It will be over 5 years.  With perfect credit in last 4 years. Still no dice?

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Bump.

My initial reaction was that you would have to pay it.  I would think a lender would be troubled by a large unpaid obligation.  But then, if you can get another house after you are foreclosed on after three years of on-time payments with FHA, why not a house after an auto repo?  I can imagine there migth be different rules for foreclosures and other unpaid debt, but I don't know.  Hopefully one of the mortgage gurus will chime in.

[GregB]

You do realize that as soon as you have the house the bank you owe $9K will take you to court, get a judgement plus attorney and court costs, and put a lien on the house, right?

[Booner72]

I think Greg hit the nail on the head - an underwriter will think the same thing and will be leary of this could-be-judgment.  I think what you can do is settle with the car company and get it taken care of once and for all.  Then you can move on w/o worrying about the past.  Good Luck.

[Anonymous]

Even though it would be outside SOL? Or maybe I just don't quite understand SOL. I thought SOL would be up 4 years after ther date they sold the car at auction. And after that if they took me to court, I could use SOL as my defense.

[mocha82]

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@GregB wrote:

You do realize that as soon as you have the house the bank you owe $9K will take you to court, get a judgement plus attorney and court costs, and put a lien on the house, right?

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+1