<prompt> Human: Hey PF,I am 23 and looking to buy my first home, but Im worried my very low credit score about 580 will keep me from being considered by any lenders. I have a decent job and make about 60k before overtime or bonuses, and my only debts are a couple credit cards that I usually pay off every month. I own my car and have been living with my parents for the past year pretty much just paying for groceries and some minor bills, like phone and internet.The reason for the low credit score is that I had a 4000 loan go into collections about 4 years ago that I never settled on and honestly kind of forgot about until recently. The statute of limitations in my state for suing on debt are for 3 years and Im worried that this will be reset if I even contact the collections agency to inquire about settling in order to clear up my credit. if its even possible to remove this from my reportI have about 38k in mutual funds which I plan to use most of as a down payment and I dont want to spend more than 150k on a home. Am I even close to being able to buy a home considering my credit situation? I could easily settle my account in collections, but almost dont want to if the statutes for them being able to sue my are expired and there is the possibility of the account remaining on my report after I settle..  <response>: slim to nonelenders like a nice high credit score of above 700and that 4k in collections looks to them like you cant pay your bills 