Can you buy a home with items in collections? My husband has 2 items, one of which is 6 years old and the other is about 4.

Asked by Florida_Cal_Mommy, Tampa, FL Sat Jul 24, 2010

I know things are tougher in the current market. But there is there anyway to get financing?

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8
, ,
Sat Jul 24, 2010
Yes, it is possible. Medical collections typically do not have to be paid under FHA guidelines. Most lenders can determine that for you by taking an application and submitting it through desktop (automated) underwriting. The age of your collections should work in your favor since they are more than two years old...
1 vote
connoranne, Home Buyer, Mount Laurel, NJ
Yesterday at 8:51am
my personal experience i had to get some of my collections removed before buying a home, my mortgage rep had told me it would be better to get them removed. WHICH I HAD NO CLUE WHAT TO DO..... we got recommended to a company called select us which was great, they had all four collections removed my score jumped up higher and it also all happen in less then 6 months i was so so happy
0 votes
Dp2, , Virginia
Sun Jul 25, 2010
Chances are if those collections have already become judgments, then some lenders will require him to resolve those liens before obtaining a new loan, and others will only care about the most recent activity.
0 votes
, ,
Sun Jul 25, 2010
The first response from Sam was spot on. Your lender of choice should only reaffrim it, again, depending on the psecific nature of those colections.
0 votes
Sheila Steph…, , Lutz, FL
Sun Jul 25, 2010
If the lender requires the debts to be paid as a condition of the loan, they will advise you. Also, if payment is required, pay at the closing. Often paying an old debt off will have an adverse effect on your credit score - if it's one that has been dormant for a while. Activity of any kind (even payoff) will bring it to life and it begins to count against you.

Get pre-qualified! Any lender will be able to help you thru this important first step. Your home search will be much easier knowing what you can purchase. Good luck.

Sheila
0 votes
Hannah Flieg…, Agent, Larkspur, CA
Sun Jul 25, 2010
This answer is for your husband,

You might be able to get financing with less than perfect credit but you will pay a higher interest rate for the mortgage product.

You may want to pay the debt or not pay the debt. If the collection agency is still calling you and pursuing you and depending on the amount of the debt you may want to pay it off. If the collection agency takes you to court to obtain a deficiency judgment against you for the debt owed then they would place liens on other property, garnish wages, etc. If the statue of limitations has not expired you might want to consider paying the debt.

If you pay the debt, it will probably effect your credit score negatively because the negative trade line is older and counts less on your credit profile. Therefore you may not want to pay your debt.

The appropriate steps would be to actually pay the debt because you owe the money. You can ask the collection agency in exchange for paying them to remove the late payments off your credit report. This way you handle your obligations and get the credit in good standing. If the collection agency is unwilling to remove the late payments, etc off your credit reports then you might consider credit repair services to assist in navigating you through the credit repair process.

Hannah Fliegel, FICO Pro
415-999-9348
The Credit Repair Expert
Web Reference:  http://www.HowDoYouScore.com
0 votes
Debbi Tinker, Agent, Brandon, FL
Sat Jul 24, 2010
A couple of other good resources for you would be:

Jayna Hamel
Wells Fargo
Jayna.Hamel@wellsfargo.com
(813) 323-1717

Chuck Rogers
Regions Mortgage
chuck.rogers@regions.com
(813) 230-1249

Best of luck to you!
Debbi
0 votes
Alma Kee, Agent, Tampa, FL
Sat Jul 24, 2010
You can get a definite answer and good advice from:

Kristine Bredeau, Vice President
Mortgage Branch Manager
HomeBanc
3725 West Grace Street Suite 300
Tampa, Florida 33607
Direct: 813-549-7234
e-Fax: 813-902-6621
email: Kristine.Bredeau@homebanc.com
Apply On-Line: http://www.KristineBredeau.com
0 votes
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