Home loan possible?

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4 Responses to “Home loan possible?”

1. Nijojo on: 24 June 2009 at 10:03 pm

   Most certainly. We bought a house for 262K on a lot less income with similar scores. We did have to pay a small extra in closing (about 1.75 pts) which bites a bit but if you can swing it- then go for it. Your monthly income is a fantastic asset and your debts are relatively low (based on what you've described). If there are issues they will usually give you a chance to clarify what happened, and may have you type up a letter of explanation (we had to do that for a credit card that belonged to my husband's father but showed up on his credit since he ONCE had a card on that account) and years earlier we had been on a debt management program. Didn't cause us any more distress than that.

   I would look into FHA loans since you don't have 20% to place down. You will have mortgage insurance but it will probably be around $100/mo on FHA (depends, but that's a guestimate). If you're out of income range- which you might be- then question about mortgage insurance before you sign. It can bump your payments up quite a bit. You can always refinance later- but it's a hassle and it's expensive so try not to sign papers with that mentality.

   Then also make sure you have no pre-payment penalties and make sure that you get a FIXED interest not an ARM.

   Shop around- but be judicious who really pulls your credit. They should only have to pull it once, maybe twice and your scores will drop each time.

   I personally do not recommend Country Wide or CTX Mortgage. I have one heckuva nightmare to share about those should you want to hear it. Perhaps research online for lenders that have excellent customer ratings or question people you know what they thought of theirs. Make an appointmen and just sit down with them and go over your situation. They should give you an thought what they can do BEFORE running your credit. If you have a copy of your report bring it and question them to give you a ballpark estimate based on that. They should be able to.

   Make sure you can afford whatever you get yourself into. Hope it goes well for you. Excellent luck!

   P.S. My hubby's credit score was in the 680's when we pulled it but when the lender pulled it (within days) it was 669. She re-pulled credit 2 months later days before closing (I'm told they should not have to unless something drastically changes or it's been 90 days) and it dropped to 645. We had really paid OFF debts- and we're rarely if ever late on anything so she really screwed us over. Finished up costing us an extra $1000 at signing so be very very careful. Also- expect the scores you have to be a small higher than what they'll have. I reckon the cut off is 619 or 620.
2. bull_rooster_aardvark on: 24 June 2009 at 10:03 pm

   I reckon you are ok to get a pretty excellent loan, especially since you are first time home buyers and there are some excellent programs open to you for that. Don't worry to much about the "hurt" from getting preapproved for a loan – its minimal, I'd suggest going ahead and getting preapproved. I reckon your income is ok and savings are fine but the price may be a bit of a stretch, though its probably ok to. You will have to pay a bit more interest based on your credit scores but its certainly possible to get a loan with those scores. So, I'd say go ahead and get preapproved.
3. bdancer222 on: 24 June 2009 at 10:03 pm

   Pull copies of your credit reports (AnnualCreditReport.com). If there are any errors, dispute them.

   If you have derogatory items, start working on clearing them — newest first, working back to the oldest. Mortgage companies are going to insist any ancient debt be settled.

   If you have single entry derogatory items like cell phone, medical, and utility bills, negotiate a pay ofr delete. That will help you score. This doesn't work as well for regularly reported items like credit cards. The collector can only remove what they reported. The original creditor's charge off stays.

   You should be able to settle ancient debt for half or less, depending on how ancient. Get any settlement agreement in writing and keep it, along with your payment proof, forever. Do not give the collector direct access to your bank account.
4. Home loan possible? :: Loan Tags | Home Loan Rates on: 25 June 2009 at 1:23 pm

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