Just curious, are these guys worth getting? Or, like credit repair are you better off hunting yourself? A property I have had my eye on is on the market. He wants 85K for it, is offering rent to own at 5% down and 850 pm. He says thats with financing being done after 6 months. The 850 is a little steep I can do 700-750 pm with 3K down. My credit repair has made progress but I am not to the point yet I would like to be. In 6 mths however I expect my scores to be greatly improved. Right now I am prob in the lower 600's. I do some research, through mortgage calculaters and such and a 85K at 30 years, 3K down & with about 2000 a year for taxes and insurance comes up in my calculations to be around 700-750 pm. Thats with inputing 6-8% interest. I talk to a broker for a consult and I hear 900-950, thats quite a leap. I get to researching again and see how all these fees can be tacked on so that the broker can get a commission for this. Not againest a fella making a living at all but ouch! I can see some variance in price but that just seems high to me. I guess I am a nutty one. I called the owner and said "I'll offer 700-750 pm with 3K down call me if your interested." I ain't holding my breath and thank goodness I don't have to move now, I can keep renting for now just fine. Just wondering the best route to take to get what I need. A monthly payment not over 750 pm. A cheaper house? Sounding like finding a 20K house at this point lol Am I doomed to have a 9+ interest rate, are 6-8% not in my furture? Anyone have exp with this? Beginning to think I am doomed to forever rent. Quite discouraged at this point.
Mortgage brokers can be a help; some are good, some are bad. Unfortunately, your scores put you in the "subprime" market for mortgages, and that is where the interest rate jumps, and the fees get added. Shop around for a mortgage broker, ask friends and real estate agents for referrals. A good mortgage broker can save you money. You may want to try Novastar Mortgage Compnay, and contact them directly. They are the largest subprime mortgage company. As a note, in the six months you planto rent, you should try to reduce your credit card balances as much as possible, that will be a hige help to your credit score. Also do all the repair work that you can (disputing, verifying, etc.) If you can get your score over 680, you'll do much better on the rates and fees. As a note, if you do end up with a subprime mortgage, the often have a clause which says you must hold the loan for at least two years, you can refinance after that (assuming your credit scores have risen). In the end, the benefits of home ownership do outweugh some of these factors. I would go for the home purchase if there is any way you can do it.
Thanks Biz! I was so very frustrated when i wrote my post. Actually I have no current debt at all. I have lived on cash for the last 3 years and all that I have against me is the inaccurate items on my reports. I have disputed everything wrong and have already had quite a bit deleted. 90% of what is hurting me is pre bk debts reporting as CO's and not IIB. Thats what makes it sooo frustrating. Thank goodness I have no credit card debt, one less hassle. The particular property I have been watching is availible now but I refuse to settle for sky high rates when the possibility of a much better deal may be waiting on my disputes to be taken care of. Who knows, that property may still be availible in a month or two and by then so will my credit reports. /crosses fingers, eyes and toes. Ok it may take longer but I try to be a optimist! I will look into Novastar, that sounds interesting. I have also found out I am prob going to be FHA eligible, is that a good program? I am sure this broker I talked too is a great guy, I guess I am just not understanding the process well. If I shop around and still get those quotes thats one thing but something just didn't seem right, maybye I am just ignorant. Plus I didn't let him pull my reports either so it could be speculation. And that is great to know about the potential refinancing clause. If I have to settle for a less than optimal rate I am sure I will want to refinance as soon as I can. Because my scores will continue to rise, no doubt about that, I am absolutley determined never to get in over my head again. After all it took me 3 years of cash only to even get to the point of looking at my reports and thinking of a house. I had to force myself to use my new credit even if I did pay it off later that night, I sound totally crazy, I know. Going to go look that up, thanks for the info. Tegleg
One thing you may want to consider in trying to get a mortgage; if you have been watching the news, you will notice that foreclosures have doubled recently. This is mostly due to "subprime" mortgages defaults. So, lenders are looking at tightening the criteria for giving mortgages. I would not take too long in looking around. The advantage of a good mortgage broker is that they can survey all the lenders out there, and find one that is the best for your situation. Again, ask your friends and coworkers about experiences and references. You may want to review the forum posts for mortgages, here and on the other boards, to review mortgage companies directly. It doesn't hurt to do your homework up front. I recommend that you go to www.bankrate.com and do some searching for mortgages applicable to yoru situation. There are calculators and interest rate information to help you in the decision making. Also, in your calculations, be sure to include the dollars for mortgage insurance. This may be the difference in the monthly payment you can't account for. Mortgage insurance must be added whenever the loan to value ratio is over 80%, which it is in your case. Once you have appreciation of the property (say in a couple of years), you can apply to have it removed.
I am so gunshy. And afraid to try. I have the following dings to my credit. A Chapter 7 in 2002. The problem isn't so much that a Chap 7 is present since it is nearly 5 yrs old but in that several of the debts that were included do not show as IIB. They show as CO's. I have disputed all, had 2 verified and letters sent and one I received a letter from and after calling they said they would update to IIB. The rest are pending disputes, I did this around March 1st. I would say 90% of my current lower scores is due to this. However anyone could see the dates on the debts, and the date of the Chap 7 and see they are within that time frame. But I am unsure how important it is that they be accuratly reporting. A repossession of personal property in 2004. I had contacted them when I could'nt make the payments. They were unwilling to work with me so I told them to come pick it up. They did and it was sold for what was owed and I received a cancellation of debt. When I looked at my reports this was there but showing a balance. I disputed it, it has been deleted from 2 and is pending on one. A post bk utility that I paid off but is reporting a balance, I have disputed and they verified. I sent a letter to them 03/09/07 to fix it or delete it. 2 post bk medical accts, disputed with all 3 per the HIPPA process, has already been deleted off one, still shows on 2, pending disputes from 03/09/07. I have used no credit whatsoever in the last 3 years. I thought it was evil lol. Currently I have some inquiries from applying for the positive TL's and one from 2/07 when I first initially checked with a singular bank for a mortgage prequalification. It was denied. =((( But that was before any credit repair had been started at all. Thats the bad of it. I have a few good thngs going: 45K annual salary. Current 0 utilization of anything. No foreclosures or judgments. No auto loans or other loans. One dept store card positive since 2000. 3 new positive TL's all used once and paid off, one has just started reporting, the other 2 should should within 2 weeks. I can get letters from landlord & utilities for perfect payment for 3 years. I just don't know if I should even try now or wait till these disputes are done. I am not sure which of the bad are hurting me worse or if even a explanation letter for my baddies would be appropiate. Sigh, doesn't look good does it? Think I want to dig a hole and crawl in it. tegleg
You could get a note right now in the low to mid 7% range. This is providing of course that you've been employed by the same company for the last two years or have at least been in the same general field. This would be at 100% financing, 30yr fixed but, you would likely have to pay some form of PMI. A 85k house would run you about 750 or so even with it. You just have to know the right brokers to approach.
Apex, Can you PM me please. I have a broker type question and do not want to hijack his/her thread. OP, anyway you can boost your score to a 640 mid score anytime soon? You may need some deletions and new TL's to get a boost, I would look into those two options quickly.
I am a registered nurse and have been since 1990, have near 17 years in my field & have been with my current employer X 3 years now. Ok PMI, thats the mortgage insurance no? the kind that pays in case of default? I realize that is seperate insurance from house insurance. So what does the 750 payment consist of? Are taxes and insurance figured with that? I take it they are. I must say your post has me very curious. I hope you do not mind, I will send a pm because I have further questions. BTW Credit1, I have disputed everything and sent letters. It's a matter of time. All depends on the fixes because theres nothing else there to work on thank goodness. I anticipate scores will increase greatly in 6 monthes. Be my luck they would make it so hard to get a loan by then that I would still not qualify, lol. Thanks, Tegleg
Have you been able to get new TL's? Have you been able to get any deletions? You need a mix of both to increase your score. If you can get that mix, in most cases it will not take 6 months to boost your score.
I applied 2/07 and received 3 new TL's Target, CJ & Orchard unsecured MC. I have used them all once and paid them off that night lol. Target has just started reporting yesterday, the other two should be soon. I did all my disputes the first week of March, I had to wait for the name/addy disputes to go through first. So far the reposession has been deleted off two, pending on one The 2 post bk medical CA's have dropped off one. Pending on 2, I sent pre hippa letters. Chase is updating a prebk to report IIB. After I called them. My biggest prebk, MBNA verified and I sent a letter to them also. Pending. 2 other prebk's verified and I sent letters out to them to fix it or delete it. Pending. A paid utility (post bk) reporting a balance verified and I sent a letter to them also. Pending I have letters made for 3 other prebk in case they verify. And 3-4 other prebks are pending also. Wondering, in my case if a day of phone calls would'nt be to my advantage. I can barely keep up with it all lol. I bought a binder to keep all my copies in. And I have spent a half days pay on certified mail and RR fees. I am hopeful to see a big change soon. I am just glad mine are all honest disputable inaccuracies, I have my Chap 7 papers for proof. Otherwise I'd be putting in a heck of alot of overtime. The waiting is the worst.... Tegleg
I would suggest you never call any OC or CA, there is no papertrail to the work your doing, papertrail is one of the most important aspect of credit repair. Your doing fine, once those all start reporting and hopefully you get some deletions your score will move. Have you looked at other cards or TL's.
Thank you credit1, you are right about the phone calls, I just get impatient. The phone call to Chase was due to a letter they sent me, however if they fail to update that to IIB after telling me they would I will be upset at myself. When I applied for my TL's I had applied for a Hooters MC (no laughin, they are supposed to be a good one to try for) they denied me. I sent a recon letter to them and they repulled TU last week. Ggggrrr.... I haven't heard anything yet. But my TU report had already cleaned up some when they repulled so it's a possibilty. I haven't applied for anything else, was afraid too many inquiries might look bad. Score is bound to improve, I can't see any way it could decrease from where it was lol. Thanks! Tegleg
Tegleg, Your situation is not as bad as you perceive, with some work and a little patience, I think this will all work out. The priority right now is increasing your FICO scores to get the best mortgage rate you can. So, we have a clear goal, which is great. First, await the results of your disputes. I know it is painful and a source of anxiety waiting for the results, but patience is critical. In the meantime, I would communicate with the homeowner about the situation. Do not give details of your situation, but communicate that you are reviewing your credit reports, and shopping for a mortgage. As for the phone calls to expedite matters, I do not see any reason not to call, just make sure you get any agreements in writing. I have found the greatest success in credit repair is actually talking to the right person who can do something about the situation. So, go ahead and call, but keep detailed notes (who, when, where, how, etc.). Don't be afraid to ask for what you want, (i.e deletion, etc.). If something is not reported correctly, call them on it. So far you are doing all the right things, just keep it up. As a note, try to save up some type of "slush fund" for all the little expenses that come up during the home purchase experience. Last, but not least, you may want to ask the current homeowner to give you an "option" to purchase the property at the stated price for a specified timeframe. Generally, you pay for this option to an owner, but for a few hundred dollars now, it may buy you the peace of mind you're looking for, and buy you the time to do credit repair and mortgage shopping. Keep us updated on your disputes process results.
