Which lenders will do fha loans under 620 credit score? Please Help?
I am a first time home buyer. I am trying to find a lender, my score is 569. The credit union that I was trying to go through said it was rough to get a loan when your score is below 600. I either need help finding a lender, or advise on how to raise my score in 2 to 3 Months? Please help
I dont have any credit cards at all and never have, I have looked over my credit report it shows, like 7 medial bills that are due to come off at the end of next year, and I have like one from drect tv for 200 dollars and one from att for 75 dollars, I do have semi new credit that was opened for my school loans, thats what i dont understand I have the money for a huge down payment on the house, the house I want is only 45,000.00 and I have 8,000 to put down. I make very good money, well for my age 40,000.00 I just need to know what to do, should I wait and pay off the things on my report? I’m lost in all this mess.,
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Mon, Mar 1, 2010
March 1st, 2010 at 11:14 pm
You will have a very hard time finding anyone willing to give you a mortgage with all those negatives on your credit report. Mortgage companies will require all those be resolved before approving your. Either wait till they age off or negotiate settlements.
Try negotiating pay for delete agreements for all those medical and utility bills — you pay x and they remove the item from your credit report. You should be able to settle those 6 year old debts for about 10%. Get the agreement in writing before you pay and don’t give them access to your bank account.
Getting the negatives removed will help your score. But you still need an active, current good payment history — at least 24 months of consistent, on time payment history.
Also, that $8K is not such a big downpayment. Most lenders will want 20% down plus closing costs. With a poor score, you really need a bigger downpayment.
March 1st, 2010 at 11:14 pm
I had to pay for most of my outstanding past due credit before the bank would even look at me. It took about 7 months for it to reflect on my score. I know you want to buy now but you will need to wait for the medical bills to come off. I had outstanding medical stuff that took 11 years to come off because the ‘time starts’ from the last time they made contact with you, not 7 years from the date of the bill as sometimes thought. I suggest you also find a co-signer. It helped when I went in with little, on the mend credit. My work history was solid, I made plenty of money but my outstanding small bills getting paid off was what made the difference in my score.
March 1st, 2010 at 11:14 pm
It takes months and months for your credit report to change, even if you paid things off. your only option is to find a credit company that makes sub-prime loans or wait until your credit gets better. Check out lendingtree.com, they use sub prime mortage lenders.
Also, if you go to the link below, download the HUD list of subprime mortgage lenders. the file is in Excel format.
March 1st, 2010 at 11:14 pm
The ONLY thing you can do to repair your credit is to pay off your debts. That will not fix it right away, but at least you’ll be moving in the right direction.
What your report says now is that you make okay income, but have a number of small, debts you haven’t bothered with. That makes you irresponsible, in their eyes, and makes you a VERY bad credit risk.
Incidentally, you are not offering a ‘huge’ down payment on the house, you are offering a very small amount in real terms, and not even that massive an amount in percentage terms. You’re offering under 18%, which doesn’t even get you below the threshold for PMI. It’s certainly better than 10%, but given the low value of the home, it’s pretty low.
Any lender who loans under these conditions will be no more than a loan shark frankly.
Sit back, save more money, pay OFF your debts (do NOT allow them to ‘come off’ due to age, that does NOT repair your credit, it just keeps it from getting worse). In a year or two, your credit should be better and you’ll be able to get a reasonable offer.
March 1st, 2010 at 11:14 pm
I would think that you can qalify for the tax credit for first time home buyers as well. these are the
FHA guidelines
Two Years of steady employment, preferably with same employer.
Last two years Income should be the same or increasing.
Credit report should typically have less than two thirty day lates in last two years with a minimum credit score of 620 or higher or in some cases no credit score at all.
Bankruptcy’s must be at least two years old, with perfect credit since discharge.
Foreclosure’s must be at least three years old, with perfect credit since.
Your new mortgage payment should be approximately 30% of your gross (before taxes) income.
These are some of the most basic of FHA guidelines for qualifying for a FHA loan. If you have answered yes to most of these statements, you probably qualify for a FHA mortgage loan.
March 1st, 2010 at 11:14 pm
No one can repair credit fast. The only direction in which credit can move fast is down. The only speed at which credit can move up is slow.
$8000 is not a huge downpayment. Until fairly recently (the late 20th century), no one, even with perfect credit, could obtain a home loan with less than 20% down. For example, no one could purchase a home that cost more than $40,000 with a downpayment of only $8000.
Anyway, yes, you should pay off the things on your report that are not due to be removed soon. However, paying them now will not repair your credit. If they were not paid on time, then they will continue to hurt your credit (although not as much) until they are scheduled to be removed, even if you pay sooner.
March 1st, 2010 at 11:14 pm
Working on building credit is hard. http://www.orchardbank.com & http://www.hsbc.com are great to build credit, but they do have annual fees & fees for EVERYTHING!
Try getting your credit reports for free at http://www.annualcreditreport.com & see if there is anything bad on there. Then I’d suggest using a credit attorney to help dispute items that are negative for you. It’s a great start. I used http://www.ecreditattorney-marketing.com/idevaffiliate/idevaffiliate.php?id=5030
They only charged $29 a month. Not trying to push anything on you, just trying to help. Good Luck in whatever you decide.
March 1st, 2010 at 11:14 pm
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