App 6 mo early to flush out zombie debt?

Anonymous · ‎03-21-2012

A lot of folks have stated anecdotes about old collections conveniently reporting again right after a mortgage application.

Assuming that was a concern of mine, would applying early (by ~six months or so) in order to "flush them out" be a good idea? The big downside is obviously the inquiry, but the two upsides is that I can see where I stand and perhaps fend off any gremlins sooner than later.

Any thoughts?

pizzadude · ‎03-21-2012

Honestly that's probably not a bad idea if you suspect that there are some zombies lurking out there waiting to pop up. I'd recommend getting a good CMS if you don't already subscribe to one so that you can watch for new CA inquiries and collections. And I suspect that you would know fairly soon after the mortgage inquiry shows up on your reports since the CRAs sell "collection triggers" to CAs.

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX

Anonymous · ‎03-22-2012

Well, the zombies in my case are well over 10 years old, but they're there. I'd have no problems disputing them off as clearly past the 7 year mark, and pull all three reports at least once a week (USAA, greatness.)

That said, I understand the dispute itself can spook the process. But, if I apply again six months later... Could they pop up yet again?

pizzadude · ‎03-22-2012

Yes, it is true that underwriters don't like to see disputed accounts on your CRs, so the disputes would have to be removed ~ obviously in your case they should be but it's just the timing of the 30 - 45 days window that might gum things up.

Unfortunately the nature of zombies is that just when you think they are really, really dead ~ they like to pop back up yet again. So is it certain that they won't try again after you have beaten them down ? Nope. But all you can do is be prepared. It sounds like you have a good approach.

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX

Anonymous · ‎03-23-2012

I applied earlier for this same purpose....to see what would pop up so I could take care of it. But nothing ever did. Now that I am under contract, been approved by lender and file has been sent to USDA, I am terrified because I have a CA softing my report about every other day. They had to have seen the mortgage inquiries so I am worried they will pop up.

boomhower · ‎03-23-2012

Rule #1 is to opt out well before apping. It will keep a lot of those from ever knowing you apped.

Student_Loans_Kill · ‎03-23-2012

@boomhower wrote:
Rule #1 is to opt out well before apping. It will keep a lot of those from ever knowing you apped.

Not true. The CRA's are in bed with the CA's and sell this information to them

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Anonymous · ‎03-23-2012

So let me step back a second then... If we know:

1) CAs monitor CRAs, looking for mortgage apps

2) CAs will report new, invalid info to CRAs in an attempt to get the consumer to pay it

The consumer's only recourse is to go through the dispute channel, right? And there's no ideal class-action, because it's really the CA's fault for reporting inappropriate info, correct?

I just want to make sure I understand the wheels here before organizing a million-collection-letter march Or, just trying to buy a house.

Booner72 · ‎03-23-2012

you understand it.

Your only recourse, I've learned, is to learn the laws and call them on it. CA's usually back down if you push hard enough and smart enough, but the CRA's will never back down. If they are wrong, and you try to fight them, you are SOL!! And I dont mean statute-wise.

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boomhower · ‎03-24-2012

@Student_Loans_Kill wrote:
@boomhower wrote:
Rule #1 is to opt out well before apping. It will keep a lot of those from ever knowing you apped.
Not true. The CRA's are in bed with the CA's and sell this information to them

I agree. There is more than one way the CA's get the info. The cheaper was is from the opt-in list. Getting it directly from the CRA's and LN is more expensive. Most of the zombie debt folks pay almost nothing for the debt and pay as little as possible for source of the info, they are the bottom of the barrel collectors. Of course optiing out wil not cure all the problems but it's free and can only help so no reason not too. Opt back in after you close if you want to get offers in the mail.