Should i pay 2 yr old collection before I apply for mortgage? Can't tell if hurting my score or not.

[samf]

I have medical bills $520 about 2 years old in collections on experian credit report. My Walmart fico is 729, Myfico 704, CreditKarma 683, CreditSesame 680, credit.com 680 and quizzel.com 670.    But, Experian.com was    580!    So i can't tell if it is really effecting my credit score because shouldn't they be lower? I am worried my actual score will be a lot lower when i check it for a mortgage loan. Should i pay off the $520 or is it not hurting my score that much and will it be refreshing the collection. The rest of my report is clean and utilization low 10%, so how much will the old debt hurt are the first scores close to what is probably accurate.    

Thanks

[RobertEG]

In the underwritng process, the lendor will consider more than simply your FICO score

Depending upon their criteria, payment of any delinquent debt may be a requirement.

While the issue of whether payment of a collection will cause a lowering of FICO score is a debated issue, it may not be a choice if payment is required for basic qualification.

I would suggest having an informal chat with the prospective lendor, and get their advice on when you should pay.

It might be best to simply enter the app process with no unpaid, delinquent debt, or they may want to see your score both with and without the payment.

As an alternative, you could attempt the PFD route if you have time, and thus avoid both CR inclusion and presence of unpaid delinquent debt prior to the app process.