Need a Higher Credit Score After Paying Collection Account with Midland Funding
Trying to buy a house and need 4 points added to my credit to get the loan. all they need is a letter from midland that i did pay off the debt
does it really take 45 days to get a letter staing your debt is paid in full and being reported to credit bureau?
—sharon
It can take all of 5 minutes to get a letter showing that your debt has been paid or satisfied. The 45 days you are experiencing is likely the estimate for how long it can sometimes take to get the credit reporting agencies to pick up on the fact that the debt is paid. It does often take 30 days or longer to get credit reports updated. When it comes to mortgages and home loans, your credit profile is often determined by your middle score. This means that of the three major credit bureaus, Equifax, Experian, and TransUnion, the high and low credit scores are tossed, and your middle score is used. Waiting for all three credit reports to be updated with the paid collection account can take several weeks.
Freshly reported paid collections on your credit report can actually bring your credit score down.
Was settling or paying off a Midland Funding or Midland Credit Management negative item on your credit report suggested to you as a way to qualify for or mortgage, or as a method to bring your score up? If so, by whom?
Getting collection accounts resolved in order to show you are a better risk to loan money to in order to buy a home is becoming more standard in the risk adverse lending environment we have been in since 2008. But if you were expecting your credit score to go up immediately after paying or settling with Midland, you may be in for a shock. Midland is a debt buyer. This would generally mean the account they have has gone unpaid for sometime. The credit reporting, if associated with Midland, is probably an older negative item. As a collection account gets older on your credit report, the impact to your credit score will often be less and less. As soon as there is a freshness to the collection item, as will occur when the collection is paid or settled and showing now zero owed, your credit score will take a dip. The drop to your credit score is only temporary in a situation like this, but it will typically last longer than the 45 days you are concerned about.
Just to be certain, are you waiting for the collection account with Midland to be updated as paid, or for it to be removed? If removed, you would likely see the credit score increase quickly.
Anyone with similar issues dealing with settlements, credit reporting and scoring, post your questions and concerns below for feedback.
About Michael BoveeMichael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked as an expert witness in court matters related to the debt relief industry. He is available to speak with you about your financial struggle and helps people resolve their debt problems daily.
Hi Michael I need high credit score to buy a house and have two negative accounts owned by midland fund. One is $1300 another one is $300. In order to raise the credit score how much should I pay? They didn’t call me or do anything to me. But in their website, it offers several options like full pay back or 60% or minimum like $50. How much should I pay back ?
If I pay back, can I get my score raised? My friends said it has nothing to do with my credit!
I typically target settlements with Midland Funding at 50 percent and lower. Smaller balance accounts do not settle for the best rates.
You can get a home loan through with paid collections on your credit. What are your credit scores currently?
Thank you Michael!
It is 687. If I pay 50% or up, can my credit score be raised? I think MCM bought my account in 2011.
You will be able to get a loan with that credit score, but typically not with unresolved collections accounts from Midland Funding on your credit reports. It really is not a matter of what your credit score will jump by once you resolve the debts with MCM. It is that you could have an 800 credit score with unpaid collections and be turned down until you fix that.
I have recently paid off Midland Credit Management who says they are the ones who take care of the account on behalf of Midland credit. I need 20 points to be approved to be preapproved to buy a house. Midland Credit Management has offered to send me a paid in full letter by fax within 1 to 2 hours or by mail that could take up to 30 days. Once I receive this letter and submit the information to Equifax will my credit score go down?
It is impossible for me to say how Midland Funding getting updated to show resolved on your credit reports is going to impact your score. Each of us have unique attributes to our credit reports. I have seen credit scores jump up after resolving a collection account, and I have seen small dips that are temporary.
More than likely, you would have had to resolve the collection account in order to get your home loan through regardless of the credit score.