Fannie Mae/ Freddie Mac

[sunrise]

Oops  sorry, I hit the wrong button

What I was trying to say is......If I have a collection that I paid last month (Nov. 2007) will I be turned down for a mortgage in March of 2008?  Scores are o.k. mid is 680....this is my only baddie in 4 years, this was a bill that was apparently sent after we moved.  I had no idea it was there until I pulled credit last month.  I paid it immediately.  It now shows pd on all CRA, but dated 11/07.  I'm not sure with the whole Fannie Mae/Freddie Mac underwriting thing what can disqualify someone.

What will disqualify someone?  Don't most banks need FM/FM for qualifying purposes?

Can 401K be considered as reserves?

I called the original creditor and asked if they could remove it now that it was PIF and I tried to tell them about us moving.....the response I got was "No, we can't remove it, we sold it and therefor it isn't ours anymore and we aren't in the business to look for people when they move just to give them a bill!"  The amount was $355.00 and was a medical bill.   I then called the CA and they said only the original creditor can remove it and that is if it was an error.    I'm exhausted.  Should I dispute this?  At the time this went into collections I had over $15,000.00 in savings........I wasn't running from a $355.00 bill!!!  They had the wrong address!!  Any help would be great!

Thanks everyone

[ShanetheMortgageMan]

It shouldn't disqualify you if that's the only negative you have in 4 years.  What is FM/FM?

70% of the vested portion in your 401k can be towards qualfying reserves, or if you are doing FHA, it's 60% of the vested portion.  Less than 100% is used because of tax implications of cashing out a 401k.

I think the second portion of your post would be better to post in the general credit section.  You can always dispute it, but never guaranteed to be removed.  Regardless, I don't think it'll affect your approval.

[sunrise]

FM/FM = Fannie Mae & Freddie Mac    sorry...I kinda made my own abbrev. was tired of typing the whole thing out.  Thank you I will post the 2nd half of my ? to  the general credit topic. 

I had a Ch. 7 BK that will be 5 yrs old in March 08(discharged), and the only baddie since then....is that darn medical collection!!  I really tried hard and was sooooo upset to see that on my report!  That is probably why more scores aren't higher! 

O.K., so you don't think this one ding is a deal breaker...whew!  Even if I try at local banks?  BTW  it is a construction loan!!  I heard these are wee bit harder to come by...especially if DH wants to be the General Contractor......we can save a bundle that way.   We did it in 1999 and saved about 23%.

Anyone know anything about Buildmax?  We might use them.  They can still do 100% financing on owner builder homes.  They charge 6 % of mtg amt though...still better that 23% for a general contractor!!

[ShanetheMortgageMan]

Since it was medical it's not as bad as if it was a utility bill, charge-off, etc.  Each lender has their own guidelines, but it shouldn't impact things in my opinion... unless the lender's guideline is no BK's for 7 years or something.  6% is a pretty steep fee, but on 100% owner-builder, it doesn't sound too bad.  Does it convert to permanent financing afterwards or are you required to do a construction take out refinance?

[sunrise]

It converts to perm...its still called const-to-perm. financing like most banks call it.  Thanks for all the help...I'm sure more questions will follow soon!!