Will paying off collections help my credit score?

I am looking to secure financing on an unexpected piece of property which came available. Naturally, I will need a loan. If i obtain my credit reports, and pay off the closed account which are posted for collection, will that help my credit score enought to make a signifiacnt difference? I have no car loans, nor do I have credit card debt...But I have a very poor score due to unpaid medical and various collections hitherto unpaid. Please advise what to do to get my score up enought to qualify for (even a high interest loan) I have the income..but need a mortgage. Also, will any more than 20 % downplayment have any bearing with a poor score? I have NEVER declared bankruptcy, planning on always "sometime" paying all my debts to those I owe!

Public Comments

1. Paying off any collection will improve your score - to a point. Any collection looks bad on an application, and it depends on the time that it took for you to pay. If you have no other loans to provide credit history then you will most likely be a risk. Planning on paying back "sometime" will not look good for a mortgage loan.
2. Yes, pay them off and then dispute them. Most medical will not respond to the dispute and should be taken off of your report. To learn more visit http://www.thecreditrepairmanual.com
3. I would not obtain your credit reports yet. When you apply for a mortgage, they will need to check your credit and then you can ask for your report for free--they have to give it to you. The more times you check your score, your credit is affected negatively, so be careful about this. You should definitely pay off the delinquent account. And, yes, putting more than 20% down will help because your mortgage amount will be lower. It's always good to put down as much as possible. This is a helpful site to obtain more loan information and also to see if you would qualify for one. Good luck! http://loan.divinfo.com/
4. Paying off collections is a long term strategy to increase your credit score but will have no short term impact. I used the following 10 steps to raise my score from 500 to 750 within one year: # Know and Track Your Credit Score # Never Miss a Payment, Starting Today # Never use more than 20% of your Available Credit # Keep Credit Cards that Have No Annual Fees Open For as Long as Possible # Extend Your Credit Limit on Cards You Already Have before You Get New Ones # Get Credit Cards that Have CashBack Rewards to Contribute to your Balance # Transfer Your Balance to a Credit Card with a Lower Interest Rate and a Higher Available Credit- # If You Think You Are Going to be FORCED to Pay a Bill Late Ask for an Extension or Payment Plan # Take out a Small Personal Loan and Repay it Over a Year # Ask Someone With Good Credit if They will Account Shadow you Read the full article here, it gives you an overview of credit scores, and the 10 steps in detail on page 2: http://millionster.com/articles/debt/increase-fico-credit-score/