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Question regarding homebuying

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Good evening

I am asking this question on behalf of my sister. She is in the beginning stages of being a first time homebuyer. The person she is working with pulled her credit and asked her to pay the two collections on her reports. In talking to her, it seems like at least one of them is very old debt, ERC is an AT&T bill and Transworld is Utility bill. How would she handle this. I did inform her to order her paper reports, which she did so now we are waiting for those to come but this is what she have from the reports that the person pulled.

 

ERC    

date reported   3/20

date opened    6/18

high credit       2029

balance            2029

acct type          I

account status    charge off

past due           2029

last past due     7/18

high credit amount is original loan amount etc.

 

she's not sure how long this one is from but she believe its from 2015

 

Transworld Systems Inc

date reported       3/20

date opened         1/20

high credit             900

balance                  900

account type          I

acct status              charge off

past due                 900

date of last activity with the original creditor 11/1/2015 (she said she never spoke to them nor dealt with this debt), high credit amount is original loan amount, account seriously past due date, account assigned to attorney collection agency or credit grantor's internal collection dept etc.

 

This one she is saying she never paid on and it is from 2013 which sounds to me like this is obsolete debt. she called the OC and asked about settlement and they told her anything past 4 years she will have to contact the collection agency.      

 

I suggested to her to settle with AT&T and then write to ERC to have it deleted. Also to dispute Transworld as obsolete debt, what I need to know is am I on the right track? of course she wouldn't dispute unless she has her reports and she has already opted out. If anyone can help it would be greatly appreciated as they are talking to her about she is ready to purchase within 30 days.

 

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If she has to purchase within 30 days (and unless she is homeless or losing her housing she doesn’t HAVE to), her options will be quite limited given that timeline.  The best thing she can do is to get all the info possible (like DOFD as Hege mentioned) and come up with a plan to try to address these.  If she can get them deleted without having to pay she’ll get the double benefit of saving the cash and getting a score boost.  Next best thing would be a PFD, so at least she gets the score boost from not having the collection.  Just paying them is the worst outcome because paid collections hurt your score as much as unpaid ones.  After she has dealt with these THEN try to get the mortgage.

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Having the mortgage pulls makes the situation more challenging since the two entities WILL know what she is trying to do.  This weakens her leverage.  Had she pulled her own reports before ever going to a broker, she could have tended to this previously...and they didn't just come out of the blue.  She should REASONABLY have known there were outstanding issues that needed to be taken care of. 

 

I have to question how someone has a utility that they NEVER paid on.  If you don't pay a utility, the utility is shut off, be it gas, water or electric.  She needs to be pulling her old files to review the original Agreement with each of the entities in question as well as an evaluation of receipts and/or bank records that would speak to HER history with those two entities. 

 

AND...as already noted, she NEEDS paper reports.  NO action should EVER be taken from a tri-merge or other online report.  The paper reports should be ordered from the four major bureaus.  But she ALSO needs to be aware that the mortgage entity is well within their rights to insist on payment prior to underwriting, and this would hold true even if it IS beyond a reporting window or litigation limitations expiry.  While they likely would NOT be pulling full-factual, there are plenty of occasions where antique and otherwise obsolete data becomes viewable.  If she doesn't like what the first broker conditions the mortgage upon, she can go down the street...but needs to be prepared for the same term to be placed on the table as a pre-condition of the underwriting approval.

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