Some Help Please !

[Anonymous]

Hello all, New member and looking for any advice you guys can give. 

Recently applied for mortgage and was told no by LO due to amount of collections.

Basically need to know if I should pay or not to pay..Looking for FHA loan.

My scores are lender pulled TU 636; EQ 624; EX 598

Last late car payment 11/08, one other account opened Jan 2010 zero lates. Oldest tradeline is from 1995 ..All other accounts closed and paid .

This is only a summary of what I assume is holding me up

Collections are :

CC $2367 DLA 8/06

CC $2113 DLA 10/07

CC $1739 DLA 9/07

Cell Phn $ 835 DLA 6/07

Cell Phn $662 DLA 9/08

Cable $284 DLA 5/08

[Booner72]

Hello - You will have to look up "common abreviations" so you can learn the language here.  The best thing, IMO, is print them out so you have a handy reference.

First,  OPT OUT - this prevents soft inquiries from collectors seeing what you are doing -  You can do this online and it is good for five years, or you can write in and you will be opted out for life.  (You can always opt in later). 

Second:  Send DV letters to all the collections.  If you agree that they are accurate - send PFD - (Pay for delete).  Start with the most recent and work backward.  The collections that are the most recent hurt your score the most.  You might be able to reach a settlement with the companies - say, you pay 50% they delete.  Though you might have to pay 100% to get them to agree to delete.  They might also say no, they won't delete, but then you will have to get creative and keep sending the PFD's different ways (Email, snail mail, certified mail, phone calls, etc).

I think you were denied bc the collections aren't paid.  The lender won't be willing to loan u money if they think a judgment is coming your way.  I was able to get approved with at least 9 paid collections.  Your score qualifies so as long as DTI and income and employment all check out.  Also the collections are pretty old (As in not the last 12 months).

You could learn a lot from going to the "rebuilding your credit" section.

Or if you don't have the money to pay them all now, start w/ the small ones you can afford and move forward that way.

Lastly:  Get comfortable and read read read read.  The searchbox is a useful tool to look up information relevant to your situation.

If you get stuck w/ something, come back and give as much info as you can about that so you can get the best advice.

Good Luck!

[Anonymous]

Thanks Booner, but wouldnt paying the collections drop score.

Also I've read on here that for FHA some lenders don't require payment of old collections. 

 In addition in my state PA. I think I can no longer be sued for the credit card debts so a judgement being filed

is not an issue..could be wrong...Just don't want to pay thousands of $ to be told because you did that you have to wait another 12 months

[gagum129]

Paying the collections should not drop your score. It has the same effect paid or unpaid. Unless you do a pay for delete (highly recommended). Do some research on for PFD. From what I read most collections do need to be taken care of unless they are medical. Some lenders will let the medical collections go unpaid.

[Anonymous]

Thanks for the assistance ....so try PFD is what I am lookin at