Hello, I posted last week regarding getting a loan with credit scores hovering around 600. I had signed for a loan for a so-called friend who made several late payments. I hadn't checked my credit since last fall when the payments were late. I just checked my scores, which were Experian 653, Equifax 690 and TU 702...not the best, but much higher than I had assumed. My friend is due to sell the home with the loan in my name shortly, with a buyer securing the loan. If I was to purchase a home with my girlfriend prior to being released from the other loan, could I do so if I had a co-signer? Are interest rates increased when a person has a co-signer? Also, with credit scores like mine, can I expect to pay much higher interest than normal? Thanks.
Great questions. 1) Your middle score of 690 falls within the range of average. While there are some programs you won't qualify for, it will not be much of a limitation in getting financing. 2) If you and your girlfriend buy a home together, the lender will use the middle score of the one who earns the most income. 3) If you can provide proof that this friend has been making the payments on this mortgage that you co-signed for, you will not have it's payment history counted against you, or the payment against your debt to income ratio. Still, it will be much easier if your friend sells his home first.
