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Mortgage Loan App

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Anonymous
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Mortgage Loan App

I am concerned about my score applying for a mortgage loan. I recently paid off about 6 small ($200 and less) and old collections (over 2 years) before I found out that this could actually hurt my score! Is this going to really lower my score and are small collection/delinquincies something that a lender will be concerned with?
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ShanetheMortgageMan
Super Contributor

Re: Mortgage Loan App

Most likely it will lower your score, by how much is hard to say because each person will have a different result.  But the lenders are concerned when those accounts went delinquent moreso than the last time they had activity (such as the event of a payoff).  If the time they went delinquent/into collections was over 2 years ago then they would have been a non-factor if you hadn't paid them, but that's besides the point, so just work on your scores (if they aren't sufficient already) and when you get there the collections that you paid won't be an issue anymore.
Free Mortgage Advice & Pre-Approvals (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
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