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Monthly income: $3300+$500
Debt: $620
Est Loan amount : $120.000 with 20% down
You could go for FHA with 3.5% but then your loan will be around $85.000.
You don't have any installment loan and that's something that the UW will looking for.
Paying down your debt could raise your credit score by 30 points but you will still be under 600.
Employment history has to be consistent. You need to have a good solid 2 yrs.
Maybe be this is not the right time for you.
I believe the above is incorrect. The income plus the 500.00 for the renter. I am pretty sure you can not count that as income.
Also, you can use other forms of credit in place of tradelines. Cell phone bills, utility bills, etc. Need 12 mos of on time payments.
With that being said...
Is there any way to slap about $2500.00 on that CC? It is definately killing your scores. Also, I do not think your parents can "loan" you a downpayment. It has to be a gift.
Hopefully, you will get that late removed.
Those two things will probably give you about 100 point boost!
So, I would check some no down payment like USDA or find some city/county programs to help you. Maybe your parents would be willing to pay off your CC?
Where there is a will, there is a way!
We are finally homeowners!!
Closed May 5th-30 yr fixed at 5.25%.
@WannaHouse wrote:I believe the above is incorrect. The income plus the 500.00 for the renter. I am pretty sure you can not count that as income.
Also, you can use other forms of credit in place of tradelines. Cell phone bills, utility bills, etc. Need 12 mos of on time payments.
With that being said...
Is there any way to slap about $2500.00 on that CC? It is definately killing your scores. Also, I do not think your parents can "loan" you a downpayment. It has to be a gift.
Hopefully, you will get that late removed.
Those two things will probably give you about 100 point boost!
So, I would check some no down payment like USDA or find some city/county programs to help you. Maybe your parents would be willing to pay off your CC?
Where there is a will, there is a way!
Message Edited by WannaHouse on 02-24-2009 01:27 AM
Yes, the DP help from parents must be a gift, the source of all DP and reserve funds must be accounted for and the loan officer will want a letter from the parents stating this money is a gift. Borrowing for DP is a major no-no. When my wife and I bought in 2002, much of our DP came from a policy loan against the cash value of a life insurance company so I had to get a letter from the insurance company that said "there is no fixed repayment schedule for this loan, you can pay as much or as little as you like. If there is any principal balance remaining when the death benefit is paid out it will be subtracted from that death benefit."
Incidentally, I have read that many financial advisors say traditional whole life insurance is not a very good investment, because one can do better getting term life insurance and then investing the difference between what whole life costs and what term costs. Mathematically this is accurate. However, my whole life policy kept me saving at times in my life when I was otherwise not able to save, and as a direct result when my wife and I decided we finally were ready to become homeowners we had a source for a substantial down payment that we would otherwise likely not have had. Most Americans would probably be substantially better off if they had taken out whole life insurance policies when they were young.
Thank for all the advice and feedback. I think what I'm going to do is hold off on the buying for the moment and keep pumping money into my CC's and then my savings, while still checking out open houses and listings to get a better feel for the market and the process.
I do have one more question. should I consider going for a pre-approval in the event I find a property that can't be resisted for the price (i.e. foreclosure, REO, etc.)? How much would/could the inquiry from the pre-approval process hurt my credit?
scores need to get up to 620 as most programs are changing to 620 minimum.
The DTI is also going to be really tight if you have 520 per month in loans and 100 per month in CC. You only have room for about 1400 in debt to keep under general DTI guidelines, so if 600 of it is oging to those, then you are only looking at about 800 to cover PITI. Or around maybe 80K purchase price. That number varies alot depending upon taxes, etc.