Anyone loan to 500 score or alternative credit??

[Mellochick]

Just curious, I am in Ohio and have a lender who will go down to 530 for FHA but are there any lenders who will actually go down to the 500 limit or use alternative credit?? Fiance has absolutely nothing outstanding or in collections on his credit report but he has very low scores from past mistakes that we have now paid to delete or had corrected and deleted on his file. He has no credit cards and no loans at all in his name. We are looking at a home up for auction. Hoping it will go for under $80,000. We have up to 20% down if needed. Any help here???

[Anonymous]

So basically what little credit history he has is bad.

I don't know enough to say he can get a mortgage, I just have life experience to fall back on, and its gonna be a hard sell for a mortgage company to sign off.  If he has a steady job, and other varibles that might be enough to push it by.

Check with Nixon on here, he can tawk a creditor into most anything LOL

[TheGardner]

So He has no file? Your post is confusing, you stated he has nothing outstanding or in collections.. what is holding his scores down? I suspect there are likely something derogatory on his reports for his scores to be so low.

Maybe try for a capital one card, or better yet a secured card that uses a SP approval. This will start a revolver history bringing his scores up.

[TheGardner]

If you have any cards, older the better, add him as an AU. This will also improve his scores.

Sorry, I'm on a mobile phone can't edit my original post.

Good luck!

[Mellochick]

He HAD stuff on his report that was pulling his scores down. Most of it was old and some of it was reporting wrong. I had disputed a lot of it and pretty much everything got deleted completely. The only thing left are the 5 medical collections. Three of which may get taken off due to unemployment at the time and two can be paid in full by time of closing. So realistically he has no profile anymore but just a low score from the past issues. Not sure if hard money lender is the way to go as it concerns me to get scewed over. He may qualify for USDA Guaranteed Loan but his scores may be too low. 

[TheGardner]

Unfortunately this isn't the same as no profile. Those medical collections could just as well be credit card collections under FICO 04. Unless paid they will continue to hurt (still hurts paid just won't update monthly making the collection current.

My advice is search whychat HIPAA Process to help with the medical collections. This will help improve your scores.

Get a secured card to start building revolving credit history this will also improve your scores.

I would not recommend getting a new mortgage right now. You will end up with a high interest rate from a sub prime lender that will cause much regrets later.

Do the above and your scores may have significant improvement in as little as 6 months! (I suggest 6 months as if hippa process works it will take 6 months to generate a score if his profile is really empty at that point.

1 year for best results.

Good luck!

[Mellochick]

I need a loan right now though as the house we want goes up for auction at the end of the month. We have been repairing credit and fixing things for a year now. We are tired of waiting. We just want to get this house even if it means a hard money loan and a refinance later as we continue to improve the scores. Any help here?

[TheGardner]

Of course the option is yours. My advice was just trying to help you not get taken advantage of. As I told my wife when we were home shopping, there is always another favorite house right around the corner. Trust me, there is. Fortunately we walked away from her "favorite must have " as we found a much better and cheaper (not dollar amount but value) home just 30 days later after 2 other must have homes weren't workable.

I have no experience in a hard money loan so will wait for others to post further advice.

[Peter1142]

As others have said, If he were to find anyone willing to give him a mortgage with no credit to his name but collections, the interest rate would be sky high... sorry. I would urge a visit to the rebuilding forum.

Could you maybe qualify without his income?