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Received FHA number before 4/1 but have question about unpaid collections?

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LondonMassey
Frequent Contributor

Received FHA number before 4/1 but have question about unpaid collections?

I have 4 unpaid medical collections stemming from 2005-2007, they total about $5500.  These are bills from when I had insurance but they never billed them.  I didn't know about these collections until Jan of 2010 when I pulled my credit reports for free.  I tried to get them to bill the insurance but they refused.  I a single mom of 3. and I am aware that these bills were for service I received, BUT I had insurance.  I really don't feel as if I should pay them due to the hospital not billing properly.

 

I asked my broker if all would be ok and he said it's fine, but reading all these posts, I'm scared that the UW will make me pay these before I could close.  If that's the case, I won't be able to get the house because I don't just have $5500 to spare to pay them.  I won't be able to start saving real money until I purchase the home (it's only 55k). 

 

Does anyone know about FHA and approval with unpaid medical?  Old unpaid debt?  I received my FHA number before 4/1, so I'm not obligated to be held to the new rules, but I have no what to expect overall.  Anyone have experience with this?  Will I be ok?  Will the UW take into consideration that I'm a single mom and our household income is roughly $1600/mo (there's about $700 more that I'm not including on anything) and paying these would cause a hardship?

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cdtotten
Established Contributor

Re: Received FHA number before 4/1 but have question about unpaid collections?

Many underwriters adopted the new FHA standards for cases before the cutoff date - they were proactive and starting the process. The best thing you can do is talk to your lender. Some underwriters will make large charge offs be paid in full before they will approve the loan, others won't. It all just depends on the underwriter.


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m29
Regular Contributor

Re: Received FHA number before 4/1 but have question about unpaid collections?

I also recieved my FHA case number before 4/1, but the lender I am using is already implementing the new rule, so i had to pay off a 5 year old Collection account because it was $1002. 

 

I was more interested in the 4/1 date because that is when PMI and MI rates were going up!


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LondonMassey
Frequent Contributor

Re: Received FHA number before 4/1 but have question about unpaid collections?

Well, if they "make me" pay these medical bills, I'll just keep renting until they fall off and try again. My broker seems to think who they're going through won't require me to pay them off, so hopefully these months I'm sitting waiting on the bank to approve the short sale for the house aren't wasted.  I guess I'll find out eventually...

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Catacam
Frequent Contributor

Re: Received FHA number before 4/1 but have question about unpaid collections?

I think it depends on the lender. Can you go get sneaky and find the underwriting overlays for your bank?? I found mine and felt better when I found and read them. They generally only require payoff for single bills over $5k. I think they get nervous about a lien being placed on the house.

 

I found the uw info on their wholesale site! Smiley Happy

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Message 5 of 6
Anonymous
Not applicable

Re: Received FHA number before 4/1 but have question about unpaid collections?

I have 4 unpaid medical collections stemming from 2005-2007, they total about $5500.  These are bills from when I had insurance but they never billed them.  I didn't know about these collections until Jan of 2010 when I pulled my credit reports for free.  I tried to get them to bill the insurance but they refused.  I a single mom of 3. and I am aware that these bills were for service I received, BUT I had insurance.  I really don't feel as if I should pay them due to the hospital not billing properly.

 

I would suggest getting in contact with your insurance company (if you still remember who it is).  Here's the hospital's problem, they have a year to file claims (could be less depending on your insurance), if they don't file a claim within the "timely filing" period it's their problem as in they have to write these claims off due to timely filing.  This is probably why the hospital is refusing, however they are more than likely contracted with your insurance company to file claims and it is probably the policy at the hospital to file your insurance for you that way the insurance pays them not you.  Sometimes - especially cases like this - your insurance company is your best ally and they will call providers on your behalf.  And you can always get the paperwork that you filled out each time you were there that gave them your info - they had the info, it  isn't your fault they didn't enter it.  For $5500.00 it is certainly worth taking the time to make some calls.

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