600 credit score chances?

[rc1078]

Hi everyone.  I will try to make this as brief as possible.  I was living at a house that was foreclosed.  I did not own, nor was on the title.  I have since moved across the street to the neighbors.  The house is back on the market, thanks fannie mae. 

At first it was over priced and now has finally come down to a decent price after almost 100 days on the market!!  I would like to purchase this house. 

My problem is I have been working on my credit since I left that house.  I got it up to 640's before a stupid collection popped up in December which crushed my score right down to 600, that and I didn't pay my CC off prior to posting.  I am calling the CA to see if I can get this removed in anyway shape or form.

Who should I contact about working with me on these low credit scores?  I make enough money to cover the house.  I have no bills, no car payment.  2 credit cards 1 unsecured (1,000 CL wells fargo) and 1 that is secured (300 CL Us Bank).  I have a personal loan of 1500 that has never been late.  But I have a repo from 2010.  I make about 60k a year and the asking price for the house is 139k.  This house qualifies for a homepath renovation mortgage.

Any help is greatful.  I do have a family member that maybe able to purchase this for me to give me more time, but that is a last resort.

[MovingForward_2012]

Well if it is back on the market as a bank owned foreclosure, it will likely be on the market longer than a normal sale because it takes a little longer to get your offer accepted by the bank. So I would use this extra time to work on your credit and funds for downpayment and closing costs.

Most lenders require a 640 with no new collections within the past 12 months. So you need to work on a settlement with the CA and get something in writing from them that says if you pay x amount, they will remove it off your credit report. Also, continue to pay your balance in full right before statement cuts. You should leave no more than 10% on your cards. Once the collection is removed, you should have your score back in the range to qualify. You're almost there! :-) And don't apply for any new credit since you are looking to purchase soon.

[Anonymous]

I agree with what MovingForward said- we just in the past couple of months tried to get pre-qualified to buy a house and the LO told us I need a minimum score of 640( we aren't using my husband's credit.) I asked her if we would qualify if we went for a USDA loan, and she said we might but it would be better to wait til my score is 640.

[rc1078]

Thank you both.  I will keep working on it.  I am just nervous that this house may go bye bye, and I know its such a steal at this price.  Its 50-60k under market value.

[JM-AM]

Most likely you wouldnt be able to do anything until Dec or Jan of next year.

The new collection from Dec will play a part of that. Now if you can offer them a PFD and they accept, then pay the collection and have it removed. This may give you the extra points you need and qualify you sooner.

[purbutterfly77]

I was just denied a pre-approval from Wells Fargo because my mid-score is 637 lender pulled (myfico has it at 656). My highest score is 676. So to save yourself unneccasary pulls I would say wait until you have a 640 mid credit score at least.

[jadeite788]

PFD that credit card,  go to the rebuilding credit forum, they should have examples of PFD letters.  That will help a bit.  

[credit3xhausted]

Also, if the repo is paid you should try sending 

GW letters.