Close

See current mortgage rates on Zillow Mortgage Marketplace

Profile picture for ashleytech03

FHA Loan with collection accounts

I have had som credit issues in the past due to having times were I wasn't able to work which resulted in my credit taking a downward swing. I have been working on getting alot of collections off my credit so far I have removed 3 out of 10. I am have sent out letters on the 28th of October with no response from almost all of the collection agencies. One of the agencies told me over the phone that they cannot provide me with details for the debt they can only tell me the amount that is owed. What should my next steps be since I want to be able to qualify for a FHA loan as soon as possible.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
November 18 2013 - Colorado Springs
We think we've answered this question for you!
  • Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.
 
 

Answers (5)

Profile picture for sunnyview
"It sounds to me like you should enlist the services of a reputable credit repair company. "

No. There is nothing that a hired credit repair company can you that a consumer cannot. Information is readily available on the MyFICO forums and other websites about repairing credit, targeting areas for improvement, requesting goodwill adjustments for late payments, adjusting credit utilization ratios and many other useful strategies.

Most people do not need to spend a dime repairing their credit sucessfully. Some agents want you to pay for credit repair, but that mainly benefits them since they get credit for the referral and keep you on the string as a client as you pay their buddy for services you can do in short order yourself for free. 

Don't buy it. Save your money, target areas for improvement and get with a good broker to see what the requirements are for the loan you want.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
4 days ago
It sounds to me like you should enlist the services of a reputable credit repair company.  Most of them are scams... but there are a couple reputable ones that actually do what they are paid to do. The good ones can work miracles, in just 3-6 months (I've personally referred several clients to them and witnessed the results).  They only charge a modest monthly fee, and they don't charge you until they can prove that they have produced results.  I had them take a past client of mine from a score in the mid 500's, up to a score in the low 700's in a 6 month period.
 
One of the best ones in the nation, is actually a Denver based company.   If you want their contact information, message me through Zillow and I will be happy to give you my personal contact over there that I trust.   I am NOT connected to them, or affiliated with them, in any way.  This truly is an unbiased recommendation.    

Good Luck!
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
4 days ago
FHA has specific guidelines about collections that I have pasted below:

"FHA does not require collection accounts to be paid off as a condition of mortgage approval. However, FHA does recognize that collection efforts by the creditor for unpaid collections could affect the borrower's ability to repay the mortgage. To mitigate this risk, FHA is requiring a capacity analysis of collection accounts with an aggregate balance equal to or greater than $2,000, as described below."

This means that collections do not have to be paid off to get a FHA loan, but if you have collection over $2,000 then the lender will have to really study your finances and collections to determine if you qualify for a loan. I recommend that you speak with a lender like myself that would be happy to speak with you to see if we can get you started on this loan. Well I hope this helps, if you have any other questions or need a loan please contact me through the information on my profile page. I hope this helps and good luck!
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
November 19 2013
Effective Octover 16, 2013, FHA has created new guidelines for borrowers who have had collections, judgments and disputed accounts to make it easier to qualify.

If your total outstanding balance of your collection accounts are less than $2,000, you do not need to pay them off.

If your total outstanding balance of your collection accounts are equal to or greater than $2,000, it may need to be paid in full OR
The Lender will need to verify a payment agreement is in place (written or reported on credit report) and include payment in your debt to income ratios OR 
They may also calculate monthly payment for each account using 5% of its outstanding balance and include in your debt to income ratios.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
November 19 2013
[self promotion deleted by Zillow moderator. Please see our Good Neighbor Policy.]
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
November 18 2013
 
Related Questions
FHA Loan with collection accounts
Profile picture for sunnyview
Latest answer by sunnyview
4 days ago | 5 answers
Commuting distance on a VA Loan
Profile picture for Bryce Schetselaar
Latest answer by Bryce Schetselaar
August 22 2013 | 2 answers
Seeking an FHA loan--possible?
Profile picture for Kevin Olson, Jessica Laude
Latest answer by Kevin Olson, Jessica Laude
June 16 2011 | 2 answers
Everything is good except recent poor credit, is FHA with 50% down still an option?
Profile picture for shapiroamg
Latest answer by shapiroamg
July 06 2010 | 8 answers
Mortgage Rates
 
Be A Good Neighbor

Zillow Advice depends on each member to keep it a safe, fun, and positive place. If you see abuse, flag it. More on our Good Neighbor Policy.

Homes for Sale
  1. 1075 Hartell Dr, Colorado Springs, CO Home For Sale
    1075 Hartell Dr, Colorado Springs, CO 80911

     For Sale: $239,900

    • Beds: 4
    • Sqft: 3226
    • Baths: 4.0
    • Lot: 6228
  2. 4103 Ascendant Dr, Colorado Springs, CO Home For Sale
    4103 Ascendant Dr, Colorado Springs, CO 80922

     For Sale: $240,000

    • Beds: 4
    • Sqft: 2662
    • Baths: 3.0
    • Lot: 7988
  3. 1622 Happiness Dr, Colorado Springs, CO Home For Sale
    1622 Happiness Dr, Colorado Springs, CO 80909

     For Sale: $145,000

    • Beds: 3
    • Sqft: 984
    • Baths: 2.0
    • Lot: 6851