With credit score of 639 and foreclosure and bankruptcy over 5 years ago....last 5 years payments on time...what kind of interest rates and what kind of down payment would someone need for a house of around 75,000?
2007-06-27 12:10:13 · 4 answers · asked by bethybug 5 in Business & Finance ➔ Renting & Real Estate
You have to know what you are qualified to purchase even if you have bad credit.
speculation is just that speculation.
So the first thing you should do is contact a mortgage broker so you can complete a loan application, after which he will run your credit report.
This credit report will give him your credit score. Get a cup of coffee or your favorite beverage when filling out the loan application this is not a 15 minute chore.
Your credit score will tell him what loan programs you are qualified for as well as the interest rate you can expect. This credit score will tell if you are able to get a 100% loan and if not how much cash you have to bring to the table as your down payment.
There are lots of documents and information the mortgage broker will need. I will give you a few to get you started.
#1 Six months of all bank statements you use currently, as well as any statements from your 401k at your place of employment
#2 One months of pay stubs from all that are going on the mortgage.
#3 Two years of federal income taxes and W-2s
After discussing the best loan program for you and agreeing on the program you want, the mortgage broker will issue you a pre-approval letter. Don't forget your good faith estimate (GFE). This will give you an idea of the cost of your loan. That
is in addition to any down payment how much additional cash you must bring to the closing table.
In order to preclude PMI when a lender will finance 100% of the house you are buying the mortgage industry have solved that problem by offering a 80/20 loan. Don't be afraid of them.
You have to understand that the increase in payment if the loans are adjustable.
Your first mortgage (80%) might be a fixed product, while your second (20%) could be an adjustable product. If you don't understand the product ask your mortgage broker and don't leave until he/she has explained it to your satisfaction.
Now once this has been established you should connect up with a real estate agent to find you a home. Upon finding a home you like the real estate agent will then prepare a sales contract for you and the seller to sign.
The mortgage broker will order an appraisal of the house to prove the value.
Once all the documents necessary has been collected the mortgage broker will order loan docs for the program that you agreed to earlier. Again don't plan on spending a lunch hour there to sign loan docs this is a process so be prepared to be there for awhile.
Don't sign the loan docs if anything has change from what the mortgage broker explained to you. Call and get an explanation.
I hope this has been of some use to you, good luck.
"FIGHT ON"
2007-06-27 12:52:50 · answer #1 · answered by loanmasterone 7 · 0⤊ 0⤋
You need to put down 20% as a down payment, and the interest rate would be sort of high. They have first time homebuyer program through HUD, and you should order a copy of all three credit reports and dispute the bankruptcy and foreclosure on it (among other negative items). You send them a letter disputing it, and if they respond as accurate than you send them a letter asking for a method of verification. Then they have 15 days to respond if they don't they are require by law to delete the bankruptcy and foreclosure.
2007-06-27 12:19:01 · answer #2 · answered by Maria Gallercia 4 · 0⤊ 0⤋
If you have not owned a primary home in the last 3 years you may eligible for first time homebuyer programs if your state offers them. They usually will provide 100% financing and in some cases help you with closing costs.
FNMA also has a mycommunity mortgage that allows for 100% financing. As long as your credit has been clean the past 5 years you should be fine. They usually want 3 years from a foreclosure and 5 years clearly meets that.
If you are in CA feel free to email me and I'd be glad to help you.
2007-06-27 19:08:16 · answer #3 · answered by lenderjayne 3 · 0⤊ 0⤋
how much to put down is entirely up to you if you have the money. Your interest rate will definitely be high, but no one can tell you here what rate you will get because we don't have all your information to formulate an opinion and we don't know when you take out the loan, etc. and interest rate is slowly creeping up in the future too.
2007-06-27 12:17:56 · answer #4 · answered by Anonymous · 0⤊ 0⤋