Buying a home of doing a refi? Tips =)

[Anonymous]

These are the different options other than full doc but the one I did leave out is the Fast & Easy. The F&E is like going SISA but you get full doc pricing. To go F&E you need a min of 680 Fico and low LTV and no cash out but if you have a 800 fico you can get cashout.

Sorry guys...

Reduced - Stated income, Employment and Assets verified (prime)

No Ratio - Employment and Assets verified, Income NOT stated or verified (prime)

SISA - Stated income, Stated assets but Employment verified (prime)

NINA - No Income, No Assets, Employment NOT verified( prime)

Stated - Income Stated, No assets needed, CPA letter or W2 stated or below 65 LTV. (subprime)

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masdeocho wrote:

Thanks for posting this -- lots of great info here!

You might want to explain to people the difference between full doc and no doc.

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[Anonymous]

I would have to dissagree with your requirements to conforming loans.  I have done conforming loans for clients with under 620 scores, and in some cases under 600 (although very rare).  Bankruptcy needs to be atleast 3 years out instead of 5. 

[Anonymous]

 I just did a Conforming 30 year loan for a borrower with a 566 Fico and have done many below 600,,,  Every borrower is going to be different and Im sure many different way you can take someone. As for the BK... 5 Years old is where you want to be but every borrower is different. Maybe you have a borrower that has a BK that is 2 years old but now they have perfect credit after the BK, steady job, and some money in the bank.. Things like that can help! So when I say 5 years I mean that's ideal.

I would have to dissagree with the " although very rare" comment. It happens all the time.

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Crouton wrote:

I would have to dissagree with your requirements to conforming loans.  I have done conforming loans for clients with under 620 scores, and in some cases under 600 (although very rare).  Bankruptcy needs to be atleast 3 years out instead of 5. 

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[MercyMe]

Excellant advice!

[Anonymous]

Thanks!

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MercyMe wrote:

Excellant advice!

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[Anonymous]

Thanks for sharing the article.  That's a lot of good information.

[Anonymous]

That answered  questions that  i have been searching for.  I have been paying on my house for 7 years with a contract for deed.  This is the year that i have to obtain financing and actually only have 2 months left to secure the financing.   I have been addicted to this forum like i can not believe, i read so much and feel so much more credit educated now -- thanks to all.   I usually dont write--just read and try to find all and learn all i can.  But here goes my dilemma.

I pay thru a bank for the house and it is a legal contract.  When i get financing,  i am told that it will be a 'refinance',  and i must do it this way.  My credit literally sucked, and even in the past years i have had the trajedies,  the credit backfires and iced with ignorance.  My scores are all in the low 500's so i know i will be subprime without a doubt,   it doesnt matter....i need financing !  My question is....are there mortgage companies to be suggested by anyone,  or am i the lone one with this problem?  I was told by countrywide spectrum that as long as my scores were above 500 they could help,  but then i read negatives about them.   My house values at 80,000 (midwest) and i owe 30,000 on it.   Any help, tricks of the trade, advice etc ...i could really use it because i am really nervous....ok, scared about this !

[Anonymous]

The Subprime market is going crazy right now and it's getting harder to get low fico's approved. The good new is you can try for a My Community products or FHA with a low fico and I think that is your best bet. Yes Countrywide's Full Specturm can go as low as 500 but they can't do FHA or My Community. Just remember to SHOP!!!  Good Luck!!

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ceannie wrote:

That answered  questions that  i have been searching for.  I have been paying on my house for 7 years with a contract for deed.  This is the year that i have to obtain financing and actually only have 2 months left to secure the financing.   I have been addicted to this forum like i can not believe, i read so much and feel so much more credit educated now -- thanks to all.   I usually dont write--just read and try to find all and learn all i can.  But here goes my dilemma.

I pay thru a bank for the house and it is a legal contract.  When i get financing,  i am told that it will be a 'refinance',  and i must do it this way.  My credit literally sucked, and even in the past years i have had the trajedies,  the credit backfires and iced with ignorance.  My scores are all in the low 500's so i know i will be subprime without a doubt,   it doesnt matter....i need financing !  My question is....are there mortgage companies to be suggested by anyone,  or am i the lone one with this problem?  I was told by countrywide spectrum that as long as my scores were above 500 they could help,  but then i read negatives about them.   My house values at 80,000 (midwest) and i owe 30,000 on it.   Any help, tricks of the trade, advice etc ...i could really use it because i am really nervous....ok, scared about this !

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[MattH]

Excellent summary, two points to add: lenders can look very closely at cash reserves. Most of my downpayment came from a loan against the cash value of my life insurance policy. The lender noticed my bank balance had recently increased so they asked for documentation on the source of the funds -- I suppose they wanted to make sure I hadn't taken out a signature loan or otherwise incurred debt that would affect DTI ratio. I satisfied them with a letter from my insurance company that said something like "on [date] you took out a loan against the cash value of policy number XXXXXXX. There is no fixed repayment schedule for this loan, you may pay as much or as little as you like. If there is a balance outstanding when the death benefit is paid, it will be deducted from the death benefit..."

Also, at the time we bought, my wife was a freelance writer so her income was variable and hard to document; since my salary was more than adequate to cover the payments we just put "homemaker" for her occupation when we applied.

[Anonymous]

One Mortgage Guy .. a lot of knowledge here !!

I was worrying that we were subprime ..  husb FICO 650ish mine 630 ish   I do intend to work hard to bring this up before applying ...

So if you are seeking a refi .. at about 65% if the assessed house value (reduced in MI), if it not impossible with the above .. yes, we are in debt again

Actually, I have some thoughts of filing for divorce which I have discussed w husb .. I would like to make sure that he can continue to afford the family home .. I would like to opt out and simplify w a condo ..

Is there a chance that husb could qualify for the re fi alone .. with a current high DTI ratio which would be reduced greatly by a re fi?  Husb income varies (70 BASE .. up to 97 to 120k w overtime in past  5 years)   Mortgage would be for about 145K

Otherwise, it sounds like people have to re-fi after a divorce to get their name off the loan.   Would a mortgage co. take my name off the loan .. before a divorce ?  

What is the DTI