topic Re: Old Collections and FHA mortgage in Mortgage Loans

Old Collections and FHA mortgage

Hawksfan — Thu, 15 Mar 2012 14:02:45 GMT

I have an old collection for 870 dollars reporting as a current delinquency that LDA is about 5 years old on. It will drop off my report in October 2013. I also have charge off of 66 dollars that will drop off in July of 2014. I recently submitted a mortgage application to a bank and they told me that those might present a problem as they are reporting currently delinquent. I will be getting an answer soon on wheather they can finance the loan or not. tbh I'm not really ready to buy and won't be for at least two months but me and my wife are fine if we wait a year and save more. My question is if we do decide to wait the year would there be any harm in paying the two negative problems off now. It seems the currently delinquent is possibly a problem. The rest of my history over the last five years has been flawless. I just don't want these negative items to keep roaring their ugly head. Would paying these now be a problem if we are perfectly fine waiting a year to actually buy a house? Would this look better a year from now with them showing as paid? Or would they still be a problem then?

Re: Old Collections and FHA mortgage

my25reasons — Thu, 15 Mar 2012 14:04:35 GMT

IMO, it would probably be best to call them and work out a pay for delete. If you pay it off now, it will just update the date of the charge off. Someone correct me if I'm wrong

Re: Old Collections and FHA mortgage

Hawksfan — Thu, 15 Mar 2012 14:11:12 GMT

I should have added that both companies refused PFD on multiple occasions. LDA are old on both and yest they would be updated but I don't think it would negatively effect my score as they are still reporting as delinquent currently in 1/2012, and 2/2012.

Re: Old Collections and FHA mortgage

rckstrscott — Thu, 15 Mar 2012 16:13:13 GMT

@Hawksfan wrote:
I have an old collection for 870 dollars reporting as a current delinquency that LDA is about 5 years old on. It will drop off my report in October 2013. I also have charge off of 66 dollars that will drop off in July of 2014. I recently submitted a mortgage application to a bank and they told me that those might present a problem as they are reporting currently delinquent. I will be getting an answer soon on wheather they can finance the loan or not. tbh I'm not really ready to buy and won't be for at least two months but me and my wife are fine if we wait a year and save more. My question is if we do decide to wait the year would there be any harm in paying the two negative problems off now. It seems the currently delinquent is possibly a problem. The rest of my history over the last five years has been flawless. I just don't want these negative items to keep roaring their ugly head. Would paying these now be a problem if we are perfectly fine waiting a year to actually buy a house? Would this look better a year from now with them showing as paid? Or would they still be a problem then?

If the accounts are that old, all you need to do is pay them off, and then a letter of explanation... I had newer collections than that which were paid off, and I got a preapproved with no issues at all..

If they are older than one year, and paid, that should be all she wrote.. the LOE will handle the rest..

-scott

Re: Old Collections and FHA mortgage

Hawksfan — Thu, 15 Mar 2012 22:35:04 GMT

I just got the amounts and they total just over 1000 when added together. With the new rules in place I'll have to pay anyways. So we have decided to pay now and let the clock start running on these baddies. I actually think my score may improve when they are paid. When I removed the dispute notice my scores dropped about 20 points. I think was was due the balances now going into my debt to available credit formula. Also with these currently reporting as delinquent as of last month I think the impact on my scores will be minimal to possibly even positive. Six months to a year from now I think I will be glad to not have these hanging over my head. Also when me and my wife are actually ready to buy we won't have to explain why we haven't paid and just give a reason as to why they ever showed up to begin with. Which would seem to be an easier explanation than I haven't paid because....

Thanks for the advice.

Re: Old Collections and FHA mortgage

boomhower — Thu, 15 Mar 2012 23:47:49 GMT

@Hawksfan wrote:
I just got the amounts and they total just over 1000 when added together. With the new rules in place I'll have to pay anyways. So we have decided to pay now and let the clock start running on these baddies. I actually think my score may improve when they are paid. When I removed the dispute notice my scores dropped about 20 points. I think was was due the balances now going into my debt to available credit formula. Also with these currently reporting as delinquent as of last month I think the impact on my scores will be minimal to possibly even positive. Six months to a year from now I think I will be glad to not have these hanging over my head. Also when me and my wife are actually ready to buy we won't have to explain why we haven't paid and just give a reason as to why they ever showed up to begin with. Which would seem to be an easier explanation than I haven't paid because....

Thanks for the advice.

Nevermind, misread.

Re: Old Collections and FHA mortgage

Anonymous — Fri, 16 Mar 2012 03:54:40 GMT

I had a similar dilemma with a debt that I truly did not believe in BUT $431 is far less important to me than having something lingering that would prevent me from owning my home. Just think how much better you will feel when the debts are gone for good After 6-9 months, try sending a goodwill letter. Never hurts

Re: Old Collections and FHA mortgage

Anonymous — Thu, 26 Apr 2012 13:37:26 GMT

Fidelity Information Corporation is showing as a collection on all three accounts for $2229. The original debt was for $900 plus fees. I sent a certified PFD for 25% two months ago and never heard anything back. Should I call and ask why they didn't mail a response? I requested a debt validation from the CRA and they came back a validated, with no proof. I have no record or proof from them of owing this debt and have no idea how I can get this removed or fight it. It is scheduled to fall of 11/2013.

Re: Old Collections and FHA mortgage

DallasLoanGuy — Thu, 26 Apr 2012 15:23:35 GMT

@Hawksfan wrote:
I recently submitted a mortgage application to a bank and they told me that those might present a problem as they are reporting currently delinquent.

might?

it is either a problem or not.

you should get a copy of your credit report from this lender and show it to another.

'might' doesn't cut it.

Re: Old Collections and FHA mortgage

Hawksfan — Thu, 26 Apr 2012 17:24:58 GMT

@DallasLoanGuy wrote:
@Hawksfan wrote:
I recently submitted a mortgage application to a bank and they told me that those might present a problem as they are reporting currently delinquent.

might?

it is either a problem or not.
you should get a copy of your credit report from this lender and show it to another.

'might' doesn't cut it.

It was a problem, they didn't preapprove me. I have since paid the collections and me and my wife decided we are going to wait another 12-18 months. Save more money and be in a position that the collection and charge off are not over our heads. They totaled over 1,000 dollars so it needed to be paid anyways and honestly we feel more comfortable with more money in the bank anyways. This was thorugh BB&T. The LO said he would see if they could fund and the answer came back no. The scores they used are in my signature. They weren't the problem. The problem was the collection and chargeoff were reporting as late.