We're in the process of buying a new home and we close next month. We both have great credit scores (me in the mid 700's and my dh in the high 700's) and from what I've been told, we have our final approval. We're getting the financing through the builder's mortgage co and I know they work a bit different, but from what I've been told, they will not run our credit anymore and they don't need anything else from us except who we will use for our insurance.

I got a small medical bill of $63.96 sent to collections! This is my first time for anything to be sent to collections and I don't even remember getting anything say that they were sending us to collections because if I did, I would have paid only $63.96! Do you think that will make jeopardize our mortgage?! I'm going to pay it ASAP but I cannot believe this went to collections!! I know they said they won't need to pull our credit again, but still, it scares me half to death!

You have absolutely nothing to worry about.

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Actually, they usually run your credit one more time before closing and funding. I doubt if a $64 will make them cancel the approval, but it could cause a delay while they put it aside to question it. I'd call the person who holds your debt, explain the situation and ensure they report it positively, if at all, and pay the thing off. The insurance company will also probably run your credit just before or after closing.

And just fyi, we didn't find our builder's company to be competitively priced. Plus, they draaaaagged their feet. We shopped around for the best rate and did end up going w/someone else. The builder's company put us through so many hoops, it felt good to call and withdraw our application. They still called us one week before closing (the app had been in for 6 months!) to let us know we were approved. What? And the rate was still 1/4 point higher than we got elsewhere. It really paid for us to shop.

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Don't worry too much, I don't know your mtg co's rules but when I was in mortgage lending, we did not count medical collections against anyone. Our thought on it was that it was almost as if medical bills are sent to the collector before you even are out of the office or hospital (lol). Something so tiny should not be an issue at all and may not even be cycled into your credit report by your closing.

If that's the worst thing on your credit report then you have nothing to worry about.

I will be the odd man out here...a "Collection" on your credit report can drop your score by 30 points (yes 30 that's not a typo). They will also more than likely run your credit again right before you close (it is only valid for a certain period of time). It probably won't jeopordize your mortgage (but 30 points lower will jeopordize the lowest rate possible), they will probably just insist it gets paid (by them out of your loan) so pay it now as you are planning to, ask the company for a confirmation number that it is paid, ask them to send you a letter stating the bill has been satisfied (keep it handy incase it comes up with the lender), and make sure you request whomever your payingthe bill to, to please remove this negative mark from your credit score ASAP (if you're nice and explain that you're applying for a mortgage and didn't even know this bill was there, they can move pretty fast). You should also pull your credit yourself in a few weeks (if you're not closed by then to ensure that it was removed...there is no penalty (point drop) for pulling your report yourself).
I was a mortgage officer in my former life

Good luck and Congrats on the new home!

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I doubt that this small medical bill will have any impact on your credit. Just because something has been sent to collections does not mean it has been reported on your credit. First of all the threat of reporting is leverage the collection companies want to use to get you pay. If you have already been reported what is your incentive to pay sooner? So I doubt you have actually been reported to any credit reporting agencies yet.

If you pay it -- you should be just fine.

Even if you don't pay it, as someone else mentioned, most of the time medical bills do not adversely reflect your credit score. It is mostly for the purchase and nonpayment of consumer goods that the credit reporting agencies care about and track. (Although business debt will be included if done under a consumers social security number.) Medical bills are in a category of their own for the most part.

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No it won't mess you up. Worse case senerio-if they even notice it- is that the mortgage company will ask you to pay it and expect a letter of payment from the collection agency as proof. But I don't think they will run your credit again anyway.

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