Hi folks-I am in dire need of some information and hope. Let me start with my information. In 1998, I was in a hopeless marriage, late on my mortgage, and in approx. $30,000 of my ex wifes credit card debt. Filed Chap. 13, discharged Dec of 98. Divorce finalized in Dec 2000. Since then, I have had two credit cards(Cap1 and Providian), never late, Cap1 is paid off, Prov. paid off as of my next payment. AU on my current wonderful wifes Discover, which has approx $3000 on it. Bought a new car in Aug 2001, whopping 18% interest. Refi a year later at 14.9% Over the years, I have been getting lots of the junk off of my CR, including the BK and a judgment in the last 2 months. As of right now, the credit score I got from E-loan was 622. I am trying to get prequalified for a small mortgage (<100,000) I dont have a lot of money for a DP and closing, $5000 maybe $7000. Monthly gross of $2800, car payment around $350, Discover will be paid off on my personal debt reduction plan in 5 months, and a school loan of $70/month. I am going to try to refi the car again now that the BK and judgement are off my CR, and get that payment lower. I dont know all of the ins and outs of mortgages, but I was joint with my ex on the mortgage, and my current wife previously had a mortgage, so FHA is out of the question. So what are my best options? With rates probably getting lowered again tomorrow, I need to act now to get this mortgage to buy a home. The only real scars left on my CR are from the Credit Union that my old mortgage was through. They steadfastly refuse to remove any of the bad things from my credit report. I even offered to make restitution of the credit card I had with them in exchange for them removing the deragatory statements, but they werent interested. Any and all comments would be greatly appreciated.
gmatt firstly, your situation is not hopeless. I have worked with many clients who have had much worse credit than you and been able to help them get a mortgage that fit their needs. I am not sure why you feel that FHA is out of the question, but it probably isn't. Also, there are conventional programs available that you may well qualify for. These programs can possibly allow you to go up to 100%. You have reestablished credit post BK and the BK is over 4 years old, so it really won't be much of a hinderance. With all that I have written above, there is a tremendous amount of information that would still be needed before I or any other good mortgage person could really direct you the best way to go. Some of the necessary information should not be posted on a public boarc. If you wish, you may email me off-board by clicking on my name at the top of the post and we can go into more detail. Good luck to you and look forward, not backward. fla-tan
(A) What's the reason for the big rush to buy a home? (B) My wife pools home loans at the highest volume home loan funder of the free world. She was just last night talking to me about the Fico scorces on some of the loans, (Her interest in all this has increased as she has witnessed the results of my attempts to repair her credit, and we are planning on buying some homes for resell in the future.) ......the range was 560 to 780 with many, many loans under 620? I am rather positive you will get a home loan, Your debt to income may be a factor?
The reason I am in such a rush to get a home is because I live in a small 1BR apt with my wife, a 2 year old, and one on the way. And debt to income is my concern, especially because of the the car loan. Which leads me to another question. Should I try to refi the car loan? I was going to trade the car in, but it is horribly out of equity right now. I would probably take a $3000 beating on it right now. I know that I would probably get a much better rate on a new car than refinancing my current one, but with no DP and $3000 in negative equity, that would be painful...
Gmatt I truly understand your pain and problem, I could write a small novel in my personal story of financial success and failure over the last 15 years. Some low points where in 1997 buying tacos at del taco in California on Tuesday night for 3 for $1.00 and stopping by a water cleaning machine for .25$ a gallon to feed my family for under $4.00. I used to clip double coupons out of the Sunday LA times from Rick's in Alhambra to use at the local Ralph's grocery store. Now the wife has a 1998 Lexus es 300 and we are looking to flip foreclosure property in the next 6 months or so. (In 1986 at the age of 24 I had a home and real estate appraisal business with personal lines of credit in excess of 55k, lost it all! today I have a capital one card for $300 and a GMAC for $1,000.....lol) As of right now we are actually sharing a house with someone else, we live in the upstairs with the owner living downstairs. The terms are very good and we have almost complete use of the entire home to some degree, but the idea is to sacrifice now and enjoy actual home ownership in the future. Our combined income is over 80k/year and still we have to be careful not to over-extend ourselves, (Average home prices here in Seattle being over $200k is a factor too!!) even as our credit scores are very similar to yours. The Lexus is the first car payment we have had in many, many years...........but we plan to have it completely paid off before we tackle home ownership. Anyway, I guess what I am trying to say in the best way possible is that my feeling about rushing to buy a new home just because you need one could be a recipe for problems. The "what ifs" may cause you much more pain then pleasure. What if's may include job change, car problems, home repairs, and of course there are the new baby needs......food, clothing etc etc etc.... I believe that you will probably find a way to buy a home if you are as determined to do this as you have been about repairing your credit and I wish you all the success and luck that is possible. **((doesn't E- LOAN or lending tree have a pre-approval on line kind of thing, I assume you understand this and have played around with adjusting your stated income and debt loads to see how this would effect your home loan limits, payment options, etc.??))** But, my feeling on this that adding additional fixed debt load could do more damage then good for your in the long run? Credit Dog
i would try for fha, dont see why you couldnt get it. it has a smaller down..also, why not try looking in your area for foreclosed HUD homes? many of those homes are nice, some need work, but you pay much less for them! and fha can finance the cost to repair in the mortgage loan (203k or 203b). thats what i'm in the process of doing. good luck
creditdog-I live in NJ, so I feel your pain on the price of housing. I am 27, and make less than $40K. My wife doesnt work right now because it would cost us as much to get a baby sitter as she would make. I actually have a good deal right now with the apt. we are in-$600 a month and the only utilities we pay are phone & broadband. But I have found several homes in the Lehigh Valley area of PA for under $100,000, and the mortgage with taxes and insurance on most of these would be around $630. That gets me from about 400 sq ft to 1500. I would have to commute to work, which would cost money, but I think in the long run it may be worth it. Not sure. Right now, my wife worked out a great debt reduction plan-We paid off our doctor bills, my Providian Visa is now $210 from 2400 a year ago, our Discover is at $3000, and with this plan, it will be paid off in July. After that we planned on taking the $640 we are paying to the credit cards and turning it on the car loan. The interest is so high on that, we would like to get rid of it. And with the plan we will be paying them almost $1000 a month, and the car will be paid off in about 16 months. I am worried about refinancing, I dont want another inquiry on my report. So many decisions.
Yes, a $630 mortgage would be a beautiful thing? We are paying $800 rent for basically 3/4 of a house here in federal way WA.
