i need advice, i have no clue?!?!verizon /pinnacle

[Bluephish]

pleas help,
I have no clue about how all this works.

Long story short, my g/f and i applied for a home loan, and got denied. Her credit score was a 609. Mine was a 704 but i am a at home parent at this time. So she had to apply for the loan.(because i have no income). She has a good job salary pay.
Now she did have debts back in college, 99-04, that went to agencies. These were all finally paid off about 2yrs ago or more. But after looking at her free tuc history we see at the bottom.
original collector verizon wireless,
new pin(nacle) cred(it) serv(ice).
last updated 6/2009, opened 9/2008.
original debt 315$, current 99$,
acct type collection acct.,
I have not received any phone calls or letters from them. ever.
she did have a debt to verizon in 05 she thinks she paid off to another agency called miracle financial we have a old bill from miracle in 05, and the acct# on the miracle bill is not the same as the pinnacle acct# on the credit report. and my current acct. with verizon dsl is in good standing.

So what do you all think i should do. This has to be killing her score.
If she forgot to pay the 99$ almost 5 yrs ago, why no calls or letters. I have no problem paying 99$ but what is the best way to get this taken care of to get her score back up fast. will her score go up if she just pays it off, and it closes.

I apologize in advance for any forum mistakes i am new.

[leatherbutchpa]

Have your wife check her back records if she paid this with miracla there would be some records ie canceled check, credit card payment? I know it's pain in the asset but it's important to locate this 1st. Then you need to send pinical a debt validation letter with the proof of payment a copy of paid letter and cancelled check/ bank statement or credit card statement saying you paid it only that line with your account information and everything else blacked out except your name and address listed on it they don't need that other information make sure you black out your bank account and or credit card account info. very important!!!! . If you have no proof of payment u can be paying this twice.

If you can't find any proof of payment have them validate the debt by law they have to!

If u type on line free debt dispute letters on line this will help u out!
also check out bud hibbs web site on pinnical!
If you need any more help let me know