Can someone recommend a mortgage company that gives loans to people with poor credit and a past BK in Cin.?

Question

My husband and I would like to purchase a home but are credit scores are around 490. My husband filed Bk in Feb 05, it has since been paid off. We have no car payments, credit card payments, and no medical bills. Are dept to income should be fine. We no that we are going to pay a slightly higher rate, but we don't want to be taken advantage of. Any recommendations and or advice would be appreciated.

Answer 1

There is next to nothing available to you until you get your credit report fixed up and establish some new trade lines. Anyone willing to lend to you with a 490 score will likely require 25-40% down payment, and still charge you double-digit rates.

Most of the time, when you file bankruptcy, your credit report doesn't show things accurately. You likely still look like you have collections and charge-offs that still have balances. Get your free credit report at annualcreditreport.com, and dispute anything and everything you see that's remotely inaccurate. Just getting the collections to a zero balance, account included in bankruptcy, should boost your scores 20-50 points.

Most mortgage companies will want to see that you're back on track and have new accounts that are paid on time. You will almost definitely need 12 months of cancelled rent checks to show you paid on time. That by itself may be enough to get you a loan, but usually they want to see 12 months of payments on 3 different accounts, like a credit card or car loan or something.

Find a good loan officer in your area who is willing to work with you for a long time. Someone who can walk you through your credit repair, and get you into position to get a decent loan.

After 2 years from a BK being discharged, you are eligible for FHA financing. 3% down (which can come from a gift or many other places) and you get market rates (6-6.5% right now). That's the deal you need someone to help you get. The right loan officer will work with you to get it, and not stick you in something next month at 10% with a huge pre-payment penalty that you're stuck with for 2-3 years. You are only a couple months away from being potentially eligible for market rates.

If either one of you is eligible for a Veteran's Administration-backed loan (VA), that would allow you 100% financing at market rates too, after your two years has passed. VA is very lenient.

Answer 2

There's no doubt there's a lender out there that would grant you a loan. But they will NOT grant you 100% financing! If you have 30% to 35% to put as downpayment, they wont even look at your credit report. Qualification is based on the collateral, which is of course, the home AND the interest rate will be high. 11% to 14% They are hard money lenders. I'm sure you'll have to go through a mortgage broker to get to them! Yep, one of many advantages to go through mortgage brokers!

Answer 3

I would first ask around and see if you know any relatives or friends that work in the business, if not then you will want to make sure to go with someone that has been in business for a while.

I work at a mortgage company, I am not a loan officer but might be able to either have my company help you are at least guide you in the right direction. You are more than welcome to check out our website and apply and we will see what we can do. www.nafaz.com

Regardless, your situation is not perfect but should be able to find something for you.

Owen Hammond
Director of Sales and Marketing
North American Funding
www.nafaz.com

Answer 4

You generally need a 580 credit score for 100% financing and a mortgage broker who is used to working with people with "imperfect credit". Try this site:

http://www.bestmortgageinfo.com/

Answer 5

We have similar situation and would love to see the answers. (we're in California)