FHA Loan

[Christy0828]

I have credit scores of 658, 628 and 600 my DTI is about 41% with the payment dead on however I have a couple of lates in the last year.  I was preapproved but I was wondering my chances of this loan going through.  I am really worried and am looking for some realistic advice.

[DallasLoanGuy]

Very common for automated underwriting to still approve with the recent late pays.

I close deals like this all of the time.

The late pays are just part of the equation. Think of it like a balance beam or a teeter totter.

You have good stuff on one side and bad stuff on the other. Quite often, you will have enough good stuff(scores, assets, other good credit lines) to balance out the late pays. 

[Christy0828]

So would you say it is a good chance, what other factors would need to be secure?

[DallasLoanGuy]

were you approved thru automated underwriting?

if so, no worries.

if this is a manual underwrite, then you would have to have a REALLY good story for the recent lates. (beyond control type stuff)

[Christy0828]

I have no idea which method.  I went to a mortgage broker and he said I was preapproved and that everything should be fine.  I don't really know the company that well to trust them it is just one of the only few that do FHA around me.  The reason for the lates was because of extreme medical costs related to a rare liver disease that I was diagnosed with (after a lot of testing and testing and doctors and doctors).  Will that be a good enough reason or should I know be really worried.

[Anonymous]

Im also in process of getting ready financially so that I may qualify for a FHA loan.  My credit was checked in 2/09. At that time middle score was 510.  Here are the baddies: I did have one 30 day in 12/08. But that account now current. 10/08 collection from CMI-family member did not pay cable bill as agreed. Acct was in my name. There is a old mortgage loan left that last reported in 2004. Ex-spouse was last with payments but still in home.

Current debts:2/07 collection NCCBS. reports as zero balance now. They sold the loan to another CA. The letter they sent just stated they no longer have the account. I was making payments which they returned my 1/07 payments with the letter. It did not say who they sold it to.

Here are my debts: 

Car  12K

Car  8k-Im the co-borrower with current spouse

5 credits cards.$2800

student loan: $1700

Personal Loan: $2200

Here is my plan:

PIF the car with 8K and 4 credit cards. leave one credit card with 9% of CL.

PIF the student Loan(reason has 12/07 late pay. plus its $97 a month)

PIF the Personal loan(reason has payment of $216 a month)

Once these items are paid I will have just one debt which is the car at $466 per month and the one credit card. Will this plan help boost my score to the mid 600's? by 10/09?   I plan to have these items PIF by 10/09

[luvs2barre]

 

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@Anonymous wrote:

Im also in process of getting ready financially so that I may qualify for a FHA loan.  My credit was checked in 2/09. At that time middle score was 510.  Here are the baddies: I did have one 30 day in 12/08. But that account now current. 10/08 collection from CMI-family member did not pay cable bill as agreed. Acct was in my name. There is a old mortgage loan left that last reported in 2004. Ex-spouse was last with payments but still in home.

Current debts:2/07 collection NCCBS. reports as zero balance now. They sold the loan to another CA. The letter they sent just stated they no longer have the account. I was making payments which they returned my 1/07 payments with the letter. It did not say who they sold it to.

Here are my debts: 

Car  12K

Car  8k-Im the co-borrower with current spouse

5 credits cards.$2800

student loan: $1700

Personal Loan: $2200

Here is my plan:

PIF the car with 8K and 4 credit cards. leave one credit card with 9% of CL.

PIF the student Loan(reason has 12/07 late pay. plus its $97 a month)

PIF the Personal loan(reason has payment of $216 a month)

Once these items are paid I will have just one debt which is the car at $466 per month and the one credit card. Will this plan help boost my score to the mid 600's? by 10/09?   I plan to have these items PIF by 10/09

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You should hopefully get a boost when you pay down your credit cards. I'm not sure if when you pay off the student loan and personal loan that that will give you a boost in your scores or not. I know you will want to wait until the recent collection is at least a year old which sounds like you plan on doing. I would try to GW the 30 day late in 12/08 to see if you can get it deleted. But I'm not sure you can get a boost of 110 pts in that short amount of time. And ideally you would want your middle score above 620 in case the scores that your lender pulls are lower than what you see on myfico so you have a little wiggle room.