Mortgage Loans

[phumanr]

Hello All,

I am trying to get an FHA Loan. My scores are 602, 577, and 496. I was unemployed and have medical collections and 3 credit card charge offs. The medical collections are showing a little over 1 year old...there are 7 of them. The credit cards are 2 years old.

Do I have to pay them off in order to get an FHA loan? I have 5 positive trade lines showing on my credit report.

If possible, can anyone recommend any Mortgage Companies that can assist with this?

Thanks so much for any information regarding this.

[rckstrscott]

The medical might not be a huge issue, unless it is a lot of money, but the charge offs will definitely have to be paid off... Scott

[Sunshine85]

Most lenders require a 620 midscore for financing. I think Wells goes lower, but I believe you need at least a 580, and you're at 577.

I would work on getting your scores up, and clearing up the collections and charge offs, to improve your chances of obtaining financing.

[Familywantsahouse]

We were originally planning on FHA and working with a broker (now going USDA) We had several collection accounts and ours were all 5+ years old and we were told they needed to be taken care of in order to qualify.

I'd head over to the rebuilding boards and start trying to work on the accounts you have to get them removed via PFD, or paid and then removed via GW.

good luck!

[FICOisa4letterword]

I was just pre-approved for an FHA loan on April 30th with 2 medical collections totalling $495, which are almost 3 years old. I also have a charge-off for an old credit card that is more than five years old - this is reporting a $0 balance but was about $2,700 when I defaulted. My LO said that since the new rules for collections don't go into affect until July 1st, I do not have to pay off any of these. My midscore was 710. 

[phumanr]

THank you,

[phumanr]

Thank you for the information.

[distantarray]

what state do you reside in? it can matter a lot if you live in NY laws that would save you a lot of time and headache for a 5 year old collections/charge off.

[drkaje]

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distantarray wrote:

what state do you reside in? it can matter a lot if you live in NY laws that would save you a lot of time and headache for a 5 year old collections/charge off.

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IIRC, those laws only apply to paid CO/collection.