Advice on paying a collection when time is not on your side!!

[Anonymous]

I posted a similar question about this on the  mortgage forum, but thought someone here might be willing to offer up advise as well......We are scheduled to close on our fha loan on the 24th of this month. However, the underwriter just let us know that she will require us to pay off two collection accounts before the loan can close. How do we go about getting these paid/settled quickly? i know it is usually recommended to only deal with ca in writing, but we don't have that kind of time. What would be the best way to proceed? Any advice would be greatly appreciated!!

[Anonymous]

Hmmm...that gives you less than 2 weeks.

Could you offer to do a PFD - paying by check over the phone?

It might be for more than you had planned, but worth due to the tight time crunch.

[Anonymous]

I thought about doing this, but in the past when i have asked creditors about pfd options they have always replied that "they don't do that, it's illegal". If we settle on the amounts instead of paying in full is the impact to our current credit score the same?

[Anonymous]

AFAIK, it's not "illegal" for them to delete something from your CR...but I could be wrong. Hope I am wrong since I just got something deleted from my CR via GW! lol

Anyway, not sure about the impact, hopefully someone more knowledgable with the ins and outs and numbers will respond.

[moondog7324]

They are not required to report, but if they do it must be accurate.

[Anonymous]

Pay them.  Time is most definitely not on your side.  If you want the house, do what the underwriter says.

[Anonymous]

So, in this case...... it would be best to deal with them via phone? I'm so afraid of doing the wrong thing!

Thank you all for your replies/suggestions!

[Anonymous]

In this case, I don't see anything wrong with dealing with them on the phone.  You only need proof of payment for your underwriter (I'm assuming), so over the phone is probably quickest.  Don't let those jack-booted thugs at the CA charge you a convenience fee for paying by credit card.

[AndySoCal]

Pay them in full do not settle. Settling could hurt your scores.

[Anonymous]

That brings up an interesting question....does paying in full take less points away from your score than settling the account? Both of these collections hit the seven year mark next summer.