Can I get a mortgage with my credit scores?

Question

I am tired of paying $700 in rent. So, I am looking for houses to but that will hopefully give me a better monthly payment.

My question is: Can I get a mortgage for a $59,900 house with my credit scores being 620, 573, and 571?

My roommate - who would be moving with me - has excellent credit (way over 700) but no current employment. I have a great job that I have been at for almost a year and earn $34,000. My monthly debt is around $350 (not counting rent).

We have a $4000 down payment for whatever we do. I also have check stubs for the last 10 months of paying $700 rent.

We have to do something because our lease will soon be up. So, waiting for my credit scores to go up will not be possible.

My roommate would be on the mortgage with me. She is out of work because she went back to college full time. Before she started school she was with the same company for over a year and a half. She has student loans which - in the writing of the loan - states that she is allowed to use the loan for housing since she lives off campus.

I am currently working with a law firm that does credit repair, but do not have the time to wait for the firm to help build up my credit before I either have to move or renew my lease.

Answer 1

Your credit scores are too low to get a decent rate. Even if you were able to get a loan for 59k you might no be able to afford it. Spend a couple of months to work on your credit score before you dive into a loan. Some of the things you'll want to do is follow the steps I have listed here and make sure you get the free credit report monitoring on the article listed below to track your progress which is really important!

Here are my 10 steps you can use to build your credit score quickly. I raised mine to well over 700 points fro 500 using these steps in less than a year -- :

# Know and Track Your Credit Score (be sure to sign up for the free trial of your credit score monitoring listed on the article below. It really helped my get my score up.)
# Never Miss a Payment, Starting Today
# Never use more than 20% of your Available Credit
# Keep Credit Cards that Have No Annual Fees Open For as Long as Possible
# Extend Your Credit Limit on Cards You Already Have before You Get New Ones
# Get Credit Cards that Have CashBack Rewards to Contribute to your Balance
# Transfer Your Balance to a Credit Card with a Lower Interest Rate and a Higher Available Credit-
# If You Think You Are Going to be FORCED to Pay a Bill Late Ask for an Extension or Payment Plan
# Take out a Small Personal Loan and Repay it Over a Year
# Ask Someone With Good Credit if They will Account Shadow you

Read the full article here, it gives you an overview of credit scores, and the 10 steps in detail on page 2 .. Good luck!
http://millionster.com/articles/debt/increase-fico-credit-score/

Answer 2

I hear ya about paying too much rent!
Any-who...Lenders usually want to see 620 credit scores. They will take a look at all three from smallest to largest and whichever one is in the middle will be the score they use to determine your credit-worthiness. Since your scores are borderline, make sure you do not have any open collections. If you have middle debt (credit cards, car loans, etc.) pay them down as much as possible. If you can pay some off, do that too. That reduces your debt ratio. Most lenders will not count a debt that you have 10 months or less remaning to pay. If you can get some of your debt paid down that far, it will help with the affordability numbers.
Is your roommate planning to be on the mortgage with you? Lenders will not consider others' credit scores if they will not be on the loan. I doubt they'd let the roomie co-sign without an income either. Even if your roomie gets a job soon, the lender will want to know why they were out of work and will want to know about the two years' prior work history. I pray that it was stable.
Your down payment is not bad. That could help you quite a bit.
My last word of advice is this: Please do not get stars in your eyes in wanting to take the path of least resistance. In other words, if the lender says that it won't work for you right now, take their word for it. Do not in turn go to some lender with no scruples who will sell you the moon without showing you the spacecraft to get there. Foreclosures are high right now because consumers don't want to wait and do it the right way. Trust me. You might be better off renting for just one more year, saving up some more money and getting everything in line. Your scenario sounds like you could make a go of it...but make sure that the numbers sound legit.
Good luck!

Answer 3

First I would strongly suggest you purchase your home alone. Roommates come and go but if you guys have a fight, move away etc you'll be stuck having to sell or buying her out.

Second, your credit scores are on the low side but, you can probably get approved for a Fannie My Community mortgage or an FHA mortgage, these loans are targeted for people in your salary range and are also no/low downpayment loans. Both allow you to get 6% seller contributions which is a great benefit.

Ask a local mortgage broker in your area. If they don't know what you are talking about......keep looking. And by the way, these programs are also relatvely well priced. You should NOT get quoted over a 7% interest rate in today's market for either of these loans.

Answer 4

It can be done but the interest rate is not going to be great and the fact that you have so little debt is going to help as well. Worst case scenerio would be going through a credit repair before getting a loan.
If you would like to talk to someone to run the numbers, you are free to send me an email and I will give you the names of two of the loan officers that I work with. I work for a title company so I have seen a lot of good (and bad) ones out there.

Stephanie

Answer 5

Investor requirements state that the asigned credit score will the middle score of the lowest scoring borrower so your assigned score, with or without your roomate will be 573. That is too low for Fannie Mae but you may qualify for FHA.

Depending on the propetry taxes and whether or not your seller will participate, you may even have enough cash to close.

If you'd like me to run a quick pre-approval with no furture commitment from you, email me.

Answer 6

Your credit score is fine and the job time is sufficient. FHA will be the smartest route. You also will qualify for a gift to pay your down payment plus you are allowed to receive 6% in sellers concessions. Keep your money in your pocket to buy your curtains and some decorator items for your new home.

visit http://branch777.com/Home.aspx

or call me directly at 1-877-423-0777

Answer 7

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best wishes