My husband's middle fico score is at 617. Hoping for a boost shortly when one TL reports for July since we paid down a cc from 100% utilization to under 10%. But not sure how much of a boost we will see. Anyways, we found a new construction that is listed at $214,900 that we would like to purchase. My husband makes $7600 per month and our monthly debts are cc and car payments which total around $950 per month - the car payments make up $850 and minimum payments on cards are around $100. No baddies on credit report like no collections, no public records, no foreclosures, etc. We do have a couple 30 day late payments on a couple credit cards. We don't have any reserves - hubby just enrolled in 401K but don't have any money built up in that yet. He has been on the same job for 3 years. I wanted to get an FHA loan since that isn't score driven and use a 3rd party program (Ameridream) to help us with downpayment but in our county the cap for an FHA loan is $200,100 so that is not going to work for us on this new construction since asking price is 214,900. With a 617 score, is there any chance that any lender will do an 80/20 or a 30 yr fixed for us or will we have to wait for the middle score to go up? Any advice/suggestions are greatly appreciated.
Well I can tell you that $850 car payments and small 401k balances = bad retirement with good memories of fancy cars you owned. But thats just my opinion. Going from 100% to 10% utilization will give you a big boost. I'm no real estate expert but the $214,900 is just an asking price, perhaps you can bring it down to $200,100 with some good negotiating skills or a good real estate agent?
For age and want, save while you may; no morning sun lasts a whole day. --Benjamin Franklin
If your scores were 617 at 100% util, and you are now under 10%, you can expect a very nice score increase. I would say 50 pts at least thus putting you well within the range needed for a mortgage. Just remember that scores are not everything.
Yeah I know my car payments are high - we had bought a new car and then found out we were having twins so we went from 2 kids to 4 kids so we purchased a mini van which is not fancy or luxury so my fond memories will be driving a mini van. And just to clarify, my husband works for the government and there was 2 retirement plans and one he was sinking a lot of money into every pay period and we just found out last month that it is not a reserve for us but it goes into a big pool of retirement money for everyone and you get your share if you quit, die or retire. So he has now adjusted it so that we are putting more into the correct 401K retirement fund that is a reserve for us so we are not dumb just made a mistake about that. But thanks for your concern.
Heck I wish I made 7600.00 a month...I would be outta debt is 5 months...But still with that kind of income from what I am learning downsize where you can and keep the CC under 9% at all times...Good Luck...