We want to buy our first home in Georgia (it's $189,000), our combined credit score is probably 700. Help!!

Question

Ok, so right now we are renting an apartment. Our monthly expenses without rent are maybe $1000. The house we want is in Stone Mountain, GA and price is $189,000. We are first time home buyers. My Transperian? credit score is 712, but my husband's is lower. (I don't know, but lets say 650?) I'm 25, my husband is 26.
My first question is...
1. Do they combine our credit scores to make 1 score?
2. What are the odds of us getting approved for a loan at a very great rate?

Thank you for any help you can give!!
:)

Answer 1

your scores are not combined...and depending on the lender you go through they will take either the higher of the two, or the lower. But at the same time, your transperian is 712...but what about the other two? They will take the middle of the three. Some like new century will allow the use of the highest score. If you're score is 700+ you're A paper, meaning you should not have any problems...even if you are first time home buyers.
I am a financial planner and mortgage loan consultant here in California but am licensed to do work in Georgia. I can help and answer all your questions, so if you like e-mail me at [e-mail] or [e-mail] and I will reply with my phone number and I can better help you. But even without my help you should be able to get a great loan. But since it seems like you are uneducated or experienced in the matter, let me know and I can help you out. Give you a list of questions you should ask your bank or broker (if you dont know the difference I'll explain that as well), things to look out for, and etc. I have been doing this for a long time and don't need new business, but I wouldn't not like to see you get into a bad program. So contact me, and I will give you some advice and you can take that to your local broker or banker and get something worthwhile.

Answer 2

Here is a breakdown of how your FICO score is calculated (FICO scores use your Equifax credit report to attain a score). Hopefully this can shed some light into some of your concerns about raising your score. Your DTI is only a portion of the determining factor for your score. Certainly, your overall debt and maxed cards are not helping your score at all: 35% - Paying on time: Payment history is considered the most significant factor when determining whether an individual is a good credit risk. This category includes the number and severity of any late payments, the amount past due, and whether the accounts were repaid as agreed. The more problems, the lower the score 30% - Amount and type of debt: The amount owed is the next most important factor. This includes the total amount you owe; the amount you owe by account type (revolving, installment, mortgage, etc); the number of accounts in which you carry a balance; and the proportion of the credit lines used. You want a low balance in relation to your amount of credit available. Having credit cards with no balances ups your limits and score. 15% - Length of time you've been using credit: The number of years you've been using credit and the type of accounts you have also influence your score. Accounts that have been open for at least 2 years will help increase your score. 10% - The variety of accounts: The mix of credit accounts is a part of each of the other factors. Riskier types of credit will mean lower scores. For example, if most of your debt is from revolving credit loans, your score will be lower than if your debt is from student loans AND a mortgage. An ideal mix of accounts will have many types of different credit used. 10% - The number and types of accounts you've opened recently, generally in the last 6 months: The number of new credit applications you've filled out, and increases in credit lines requested by you, and the types and number of new credit accounts you have will affect your score. The reasoning here is that if you're approved for all of them, you may not be able to afford your new debt load.

Answer 3

There are lots of variables involved but your scores sound very average and common. Your debt ratio and income will impact the loan consideration. It appears that your PITI could be near $1,800 per month so one question to ask is whether this is more than 1/3 rd of your combined income.

They consider both your credit rating.

The odds sound pretty good. Look for some kind of state housing authority...you might find help with your first purchase and even some free cash!

Start with this website:

http://www.columbushousing.org/

If that isn't your city they should be able to point you to the proper agency. There is usually plenty of help with the words "First Time Homebuyer"...don't miss out on the opportunities of better rates, down payment assistance and the such.

Answer 4

They do not combine the scores, they will use the middle score of the main borrowers three FICO scores. Normally you place the person who makes more annually as the main borrower. But I do know of lenders that will use the higher mid FICO of either borrower regardless of incomes, so it's also a variable to look for.

A TransUnion score of 712 is good but you need to know all three, six in your case because there are two of you.

It depends on what your idea of a Very Great Rate is, I would think. But depending on your other FICO scores you should be in a good position to get better than average rates.

P.S. Please do not use anyone on this site that didn't have the courtesy of answering your questions before pitching you on their services...

Answer 5

You shouldn't have any trouble, that is a good score you have and your husbands isn't too terrible, the thing they also take into consideration is combined income, that will have a big impact on how much you can get financed for, get yourself a good buyers agent, do not use the agent who is listing the house, she works for the sellers and has their best interest in mind. A buyers agent is no cost to you, they'll split the commission with the selling agent. The buyers agent can get you preapproved for a house so you know where you stand before you even start to look.
Good Luck

Answer 6

Answer to:
1) They combine the score unless only one of you is buying the house, I believe.
2) Not that great odds, but better since you are first time home buyers. Depends on how you are setting up the loan. How much are you putting down? Please say at least 20%. That way, you don't have to pay for the PMI.
Good luck.

Answer 7

There are other factors involved but just based on your credit scores you should have no problem getting prequalified and at a good interest rate. Keep in mind you should have 3 credit scores for each of you and the middle score is the one used to obtain a mortgage. They are not averaged just used as they report. I recommend contacting a mortgage broker as they have hundreds of lenders who will compete for your business from the broker. If you need any help or have any questions feel free to contact me. www.dantadgerson.com

Answer 8

You don't get a 'combined' score that is a combination of the two individual scores, but rather you get a joint score that is a reflection of the repayment of your joint obligations.

A 712 is going to be good enough to get you a decent rate. A 650 is not. Hopefully you have a better joint score. The lack of length of time of joint credit is going to hurt you though.

Since you have a much higher score, your odds of a good rate is pretty good.

Answer 9

They will use the middle fico of the primary wage earner. Are you doing 100% finance, or do you have a down payment? Your 700 score will get you a decent rate, but the rate will improve with the amount of money you have down. Let me know if you need assistance, I work with a mortgage broker and am a real estate agent.

Answer 10

call a local bank. you can ususally get a lower rate with a first time home buyer loan. I actually just bought a new house and signed the papers today. I took a home buyer eduacation course and received a $5000 grant to use for closing costs and down payment. Just call around for differnet rates before they increase again and make sure the loan officer locks in your rate.