My Credit is " F " like the report card, and have no money. Is there a way for me to purchase a starter home?

Question

I heard there are companies that specializes in fixing bad credit, but don't they charge a fortune?
My credit score came out to 550-650?
I can't even afford to get a $500 limit credit card.
I am married with 2 kids.
My wife has a bad credit too.(but better than mine)
Maybe next year we might be able to invest $10,000 Max.

Answer 1

Buying a home isn't as much of a problem as paying for a home for the next 15-30 years. Don't even attempt to buy a home above your comfort level or you'll end up losing the home and making your credit even worse. There are alot of additional home owner charges above and beyond the mortgage that you must take into considering... repairs, insurance, taxes, closing costs, etc. One resource that may be able to help you is a non profit agency called AmeriDream. Check the link below... you have nothing to lose.

Answer 2

First, you'll want to clean up your credit. Check our site for a link to do that on the cheap.

Second, you can get into a property by a Lease to Own method. Basically, you can put money down towards a house, and that option fee sets the price of the house say 2 to 3 years from now.

You'll be paying a lease, and depending on the seller, some of that lease will go towards the purchase price. At the end of the lease period, you have the option to purchase the property and by that time, your credit should be clean enough to get a loan on the house.

Just look in the paper or check Craigslist.org for "lease purchase", "rent to own", or "lease option" properties. Happy house hunting!

Answer 3

Lender will give you money for sure. Probably charge you a higher interests rate and extra insurance on the loan for not having the down payment or good credit.

Would you consider delaying your plan? As housing market continues to slump, it might save you 10% simply by waiting for a few months. Another way to look at it, you can increase profit by 10% when you are ready to sell it.

http://money.cnn.com/2006/09/25/news/economy/homesales2/index.htm?postversion=2006092513
http://money.cnn.com/2006/09/05/real_estate/Ofheo_home_prices/index.htm?postversion=2006090514

As housing market continues to slump, if you don't plan to delay your plan, please interview several and pick a good realtor or agent.

Bad ones will talk you into buying the largest property at your credit limit. Good ones will find you a good deal (Sellers are offering discount and incentives now).

Try to stay away from Adjustable Mortgage, because 30 year fix mortgage rate is very low right now. There is no reason to use Adjustable loans except fatter commission for loan agents.

Interests only loans are not good iether. Mortgage payment consists of two parts: interests and principal. Interests are like rent, which doesn't add to the equity to your house. It simply disappear as your pay it. If you want to use interests only loans, might as well rent, especially during market downturn, because housing price won't appreciate.

Finally, for tax benefits, talk to your CPA or tax accountant. Do not consult finance with realtors or agents. They get commissions when you sign the check!

Good luck!

Good article when you want to put in bid, negotiation.
http://biz.yahoo.com/brn/060909/19463.html

Answer 4

Try the government housing called HUD or you can call your local habitat agency. Here they will build you a home with no interest as long as you gross $350 a week and your payments will be $250-$350 a month. It's according to size you need and all. Anyway, you will also have to do so many hours of voluntary help for them, like helping to build someone elses home, but it's worth it to buy instead of rent. Lower payments too! GOOD LUCK!

Answer 5

depending on what the middle score is, your not too shabby in the lenders eyes. real question would be how much you could afford, and since it is a starter home, you would not want a 30yr fixed anyway. If rents are comparable to mortgage rates, I say sooner the better because of tax deductibility.

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Answer 6

Start saving and fixing your credit.

Answer 7

don,t give up have faith and trust that somebody will give you a chance