horrible credit score home loan?

Discussion in 'Credit Talk' started by yuppietras, Sep 30, 2003.

  1. yuppietras

    yuppietras Active Member

    my credit score is currently in the mid 500's due to being foolish when i was in college, and some medical problems in the past 6 mos that prevented me from making some cc payments.... i do have a positive auto loan on my report, and a current auto loan that has never been late. other than my car loan i have no other bills... is it totally out of the question for me to be trying to get a home loan? im 30 and i dont really want to keep renting forever... other than my credit score my other factors are excellent, ive worked in the same industry for 7 years, been at the same address for 4.5 years and make decent money for the area i live in... can anyone provide me with some insight as to exactly how screwed i am for ever getting a home?
  2. wondering

    wondering Well-Known Member

    FHA programs are not credit score driven. Talk to a loan officer about your particular situation. I've closed several people with 550 type scores. 1 with zero down. If loan officer asks for any money at time of application, run. Don't shop programs with too many companies. It will 'ding' your score.
  3. yuppietras

    yuppietras Active Member

    should i just go to my bank to find out more about this, or should i go to one of these mortage companies in the phone book that advertise home loans even with bad credit. my concern is that my credit report being what it is at this point, i cant get approved for anything.... what do you mean about fha not being score driven? im sorry, im pretty new to all this, so bear with me...
  4. Butch

    Butch Well-Known Member


    I'd postpone that mortgage decision and start a campaign to clean up those reports. Then you can get a MUCH cheaper loan.

    Whatcha think?

  5. snakeman

    snakeman Well-Known Member

    The way the Fico algorithm is supposed to work (and I say supposed to), is that any similiar inquiries from let's say...a mortgage broker within 2 weeks of each other is NOT supposed to lower your score.

    I was told this by several banks and MyFico even has this information available to read on their site.

    However, not all mortgage companies use the same system and most honest mortgage companies will tell you that they see people fall through the cracks of this "system" all the time.

    There are a lot of mortgage companies that will take you on with the gollowing minimum requirements:

    1. 500 and above score (Wells Fargo for one)
    2. proof of rent/mortgage history (VOR)
    3. Verification of deposit (money down)

    Although, there are a lot of mortgage companies who will do stated income on scores rated at c- and above as long as you meet the 500 score and above marker and you can at least show a DBA (for self employed) and you can show a VOR (verification of rent for 1 year) and be able to compensate to do a loan-to-value of no more then 80%.

    This can be easier done than you might think. In this market, you should put this into your offer:

    Example for $100,000 mortgage offer the seller $100,000 for the house with the seller holding a 2nd mortgage for 20k for 2 years or however long you think it would take to roll it into one loan.

    Just my thoughts...

  6. SoParkDiva

    SoParkDiva Well-Known Member

    Good point. You will be digging yourself into a deeper hole if you try to get a mortgage now with your current scores. There are a lot of mortgage companies that will approve you but the rate will be high.
  7. yuppietras

    yuppietras Active Member

    how bad of an intrest rate are we talking on an fha loan with a credit report such as my own??
  8. Butch

    Butch Well-Known Member

  9. Trackster

    Trackster New Member

    Not true...

    This would be smart if you were living rent free. But just estimated say you pay 600 rent for 1 mth (not bad for a small house) and you wait for your credit, you are losing 600 a mth paying your landlords mortgage. If you have to pay an extra 100-? a mth on a mortgage dont you think it would be more wise than losing 600 a mth for something you cannot keep unlike investing into property and possibly having it increase after this economic downfall?

    Something to think about...
  10. jjgross

    jjgross Well-Known Member

    The post is 8 years old,alot of things have changed.That was a time when they were giving loans if you had a pulse.Now look hello!

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