im in the proccess on buying a house, my credit score is 500, i know is very poor, but i have gone far enough as giving the down payment, the house already got appraised and i already paid for the inspector to inspect the house, my credit shows negetive listing but is all paid off in full. my ratio is excellent. now my question is: would the mortgage lender would had let me go that for as to give the downpayment and inspect the house if i wasnt going to get the loan? im just worry, becuase of my credit score, but they saw my credit report before we even started the whole proccess. please give me your opinion Ed
Ed, Did you get a pre-approval from the mortgage lender before you parted with this money? It's likely that even if you get approved with such a low score, your interest rate will be steep, & you may not want it. According to the agreement, what happens to your down payment if you back out of it? If you don't get approved for the loan? Depending on how recent your negatives are, it may be worth waiting 6 months to a year to give your scores a chance to improve.
Your contract should state that "this offer is contingent on the offeror acquiring financing at x% for y years" if you can't, in good faith, get financed at or below this rate, you get your money back. "In good faith" means you've gotta actually apply for a mortgage. If you've got cold feet and don't want the house, you can always mention to the mortgage folks that you "have judgements, forclosures, etc" Dancer
Are you talking about EARNEST money?? You don't normally pay the down payment until you actually close. And also you can make stipulations as to how you back of out it if fianancing doesn't come through etc, as for the appraisal and inspection, I don't think they would be refunded in the event you didn't get the house/loan. But if you are talking about earnest money, you can usually put the clause in your contract pending adequate financing. Surely they must have given you a GFE of what your interest rate is going to be???
THEY GAVE ME A7.25 INTEREST RATE AND I WAS PRE-APPROVED, I JUST ASKING WHEN I GOT PREAPPROVED IF I WOULDNT HAVE A CHANCE TO GET A MORTGAGE THEY HAVE TOLD ME THERE BEFORE WE STARTED THE PROCCESS? IM EXCITED IM IN THE PROCCESS FOR A HOME IM JUST AFFRAID OF NOT GETTING IT. I THINK IM GOING TO GET IT BECUASE I HAVE GIVING A DOWN PAYMENT AND PAID FOR INSPECTION AND APPRIASAL. eD
You keep stating a down payment, are you sure your are not talking about EARNEST money, that is where you give the sellers a deposit on the house. As for the inspection and appraisal, you pay that out of your own pocket, regardless of approval. I would just contact your lender and ask if your loan has been put into underwriting yet?? And ask what your expected closing date is.
YES MY CLOSING DATE IS MAY 15, YOU'RE RIGHT IT IS THE EARNEST MONEY FOR THE HOUSE. DO I HAVE A CHANCE OF GETTING APPROVED ? I ASK MY MORTGAGE LENDER AND HE SAID DONT WORRY ABOUT IT. IM JUST WORRIED I WONT BECUASE A 7.25% WITH A 500 FICO SCORE THAT IS ODD. WOULD THEY HAVE LET ME GO THIS FAR IF I WASNT GETTING APPROVED?
I have to say this might be okay - not all lenders go strictly by scoring - if he has been at his job for 10+ years, his debt ratio is low, and everything he had incurred is over 2-3 years, 7.25 is a perfectly reasonable number. It totally depends on the lender. Plus, how much is he putting down for the downpayment? If he is putting down 20%, that is a huge factor. There is too much we don't know about this to make a judgement.
The best thing you can do is keep in contact with your lender. See where your loan process is at. Has it gone to underwriting etc?? I have seen all types of scores get approved, even though your seems rather low, if your lender assures you that everything will go through and you trust him/her, then "try" not to worry yourself to death. You mentioned 500, is this from one report, or is this your middle score from the tri-merged report?? One of the most important things I learned through the mortgage process, was that you need to keep in touch with your lender, if you are unsure of anything, call and ask them, if you don't understand something ask them to explain it again until you do, it's their job to service YOU.
what you mean a down payment, i thought the earnest money for the house was the down payment? the seller agreed to pay closing cost, i thought i didnt have to give any more money. beside hidin cost like insurance etc...
What type of loan are your exactly gettting?? 97%, 100% LTV?? Your earnest money, is basically money you give to the seller when you sign a contract of sale, it's in good faith that you are going to purchase the house, the earnest money will be deducted from your final closing costs. Down payment is entirely different. Unless you have gotten 100%, you will need to come up with a down payment, 3% or 5% etc. Do you have a copy of your good faith estimate?? Are you paying any points?? Origination fees?? Did the seller agree to pay a certain amount up to?? Sometimes they offer to pay anywhere from 2-5k for closing costs?
i have been Employed for 13yrs and my debts has been atlest 3yrs old, the lender said my Ratios was excellent..everything is paid off
