I have a 680 score and 1 account in collections for $500... Could I get an equity loan or does that collection need to be removed or paid off ?

That's s question only your banker can answer. No doubt that you'll get a better deal on the loan if the collection issue goes away. Good luck.

You should explain the circumstances and most small collections are not an issue when the loan proceeds payoff that collection at closing. Yes, it needs to be paid off. 

The nature of that debt can be n issue.......was it from a previous bank loan, a write off of another equity line? OTH, medical collections are common and practically ignored by lenders, but they will require a release of lien or for it to be paid off. Good luck :)

Originally posted by @Bill Gulley :

 OTH, medical collections are common and practically ignored by lenders, but they will require a release of lien or for it to be paid off. Good luck :)

 another reason we send even the smallest unpaid debt to collections !!!!!