Can you get a mortgage if you have a derogatory item on your credit report, such as a collection, charge-off, or judgment?


Believe it or not, your credit score may be high enough to qualify even with the derogatory item on your credit report.  Depending on the dollar amount of the derogatory item, it may not need to be paid off to qualify.

The first thing to do is pull your credit and take a look at the derogatory items. If you want to do this on your own, you can go to, where you get one free credit report, without a score, per year.  For a small fee, you can get your score.  If your score does not qualify, we can work with you to improve your score, for FREE.

After reviewing your credit report, you may want to pay off the collection, charge-off, or judgment thinking your credit score will improve.  However, be careful, this may not be the case. When you payoff a collection or charge-off, your score actually goes down first, before it will go up. In fact, it may take months before the score will improve. The rationale for this, in my opinion, is that it is an admission by you that you owed this debt and are now getting around to paying it much later. As a result, the score initially decreases. The score typically recovers over a period of time.

Judgments are a little different. You will likely have to satisfy the judgment before you will be approved for a mortgage. The lender will want the judgment satisfied in order to ensure no other liens could affect their mortgage lien.

In sum, derogatory items on your credit report do not necessarily mean you will not be able to qualify for a home loan. Have us review your credit report and see if you can qualify notwithstanding the derogatory item.

We offer a variety of products and services, ask us how we can assist you today:
Counsel Mortgage Group®, LLC
NMLS #178927
AZ MB #0909580
CA DBO #60DBO43873

Copyright © 2020 Counsel Mortgage Group®, LLC.