Credit report collection notice

Got an email from credit karma and experian saying a collection notice hit my credit report?!?! Ok that has NEVER happened to me. I sign in and look and it’s a bill from a Med Express for 90$. 😑. I make a dozen phone calls, pay the bill, which I would have GLADLY paid before if I would have known. I live in a duplex. I am 402 and my neighbor is 402 1/2. We have had new mail carriers all year and our mail DOES get mixed up at times. I did not receive notices for this bill. They verified my mailing address and it was accurate when I called to pay the bill. I really wanted to buy a house this year. My credit score dropped to 706 and was 740 before this happened. Im hoping with me paying it that it will go back up alittle. But how badly is it going to look for me when I go to get a house loan and someone sees that I had something in collections? When I called to pay the collection the guy told me something similar happened to his daughter and it shows as paid once it’s updated but still stays on your credit report for up to 7 years.