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Member
Posts: 6
Registered: ‎04-15-2012
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FHA loans for those with less than a mid 640...

My husband and I would like to purchase a home soon. can someone PM us contact information for brokers or lenders that can help us find financing. Our scores are mid 500 to low 600.

 

Thank you!!!!

Valued Contributor
Posts: 3,302
Registered: ‎06-09-2010
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Re: FHA loans for those with less than a mid 640...

While it isnt impossible to still find Lenders approving 580 mid score, it is very hard fetched finding them.

 

The lower the scores the more everything is scrutinized, and harder it is for approval and Clear to Close.

 

Lenders that approved 580 mid scores last week may not be approving them this week as requirements change every day.

 

To start trying to attempt to find them you would also have to let others know what state you are in. Different states have different Lenders available in them.

 

You would have better chances getting your scores up to a minimum of 620 mid scores and even better chances if your scores were above 640 mid scores.

 

With your range of scores I am not even sure if they are FICO scores, and if they are FICO scores you should also say exactly what they are not a range. Your range of scores in my opinion you will have a very hard time being approved from any Lender.

Good Luck
May all your dreams and wishes become a reality!
Member
Posts: 6
Registered: ‎04-15-2012
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Re: FHA loans for those with less than a mid 640...

We are in Texas (DFW to be exact).  My MyFico EQ and TU are both at 560.  My wife's EQ is at 600 and her TU is at 560.  Have not had a late in 12 months. All of our derogatories are from 2006-2007.  Any info is greatly appreicated!

Valued Contributor
Posts: 3,302
Registered: ‎06-09-2010
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Re: FHA loans for those with less than a mid 640...


mendoza1210 wrote:

We are in Texas (DFW to be exact).  My MyFico EQ and TU are both at 560.  My wife's EQ is at 600 and her TU is at 560.  Have not had a late in 12 months. All of our derogatories are from 2006-2007.  Any info is greatly appreicated!


With your scores, it is highly unlikely you will qualify.

Personally I do not see any lenders approving these scores. But maybe Dallas or Shane have better information for you in the TX area.

 

You need to work on fixing your credit before worrying about buying a home.

Good Luck
May all your dreams and wishes become a reality!
Valued Contributor
Posts: 3,406
Registered: ‎12-19-2012
0

Re: FHA loans for those with less than a mid 640...

+1, the rebuilding forum here is great and they can tell you what to do to get your scores up.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! Smiley Happy Last App: 4/5/13 Gardening until July 2014
Contributor
Posts: 99
Registered: ‎12-07-2012
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Re: FHA loans for those with less than a mid 640...

Yes check the rebuilding forum on here. I increased my score almost 100 pts within the last 2 months so it can be done.


Starting Score: 2/22/12: EQ 530, TU 553, EX 528(lender). 12/4/12 (rebuilding starts)= EQ 599.
Current Score: 1/4/16: EQ 743, TU FICO 724, EX 737.
Goal Score: 750 all across.

Take the FICO Fitness Challenge

Member
Posts: 6
Registered: ‎04-15-2012
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Re: FHA loans for those with less than a mid 640...

Well, we have been rebuilding. Between my wife and I we have increased our scores 80-100 points each Credit Bureau; just didn't want to have to wait another year.  We actually don't have anything else to do but wait it out.  All of our collection accounts (4 total) are paid.  We have a foreclosure and three CO that fall off in the next 18 months.  The COs are unpaid.  They do not GW or PFD, so really not much to do.  All inaccuracies have been addressed.  Have 30, 60, and a 90 day late from Conns from Dec 2011, Jan 2012 and Feb 2012.  Have open credit cards and store cards that are reporting above 50% utilization, but have paid all of them down to 29% just have not updated.  Other installments loans all paid as agreed.  We will see how many points we get from paying our credit cards down.  I might even attempt to bring them under 10% if we see a significant increase.  That is why I am asking if anyone knew of a lender that would approve for those with less than a mid 640.  I see ourselves in the low 600s by March.

 

Thanks again!

Valued Contributor
Posts: 3,406
Registered: ‎12-19-2012
0

Re: FHA loans for those with less than a mid 640...

It is your recent late payments that are hurting your score very badly. Most lenders require absolutely no late payments 12 months before applying. If you don't have a borderline credit score, they may let a 30 day late slide but not a 60 or 90 day late. I haven't had any late payments since 2005. You really got to work on paying on time every single month to establish a long record of good payment history to show lenders you are staying within your means. This will improve your score over time. Even though your 90 day late just turned a year old, lenders are going to want an explanation for why you were unable to meet your obligations for 3 months.

The lenders that approve a 620 make you jump through a lot more hoops. And on June 1st when the new FHA rules go into effect, lenders will have to do manual underwriting for scores less than 620 and the lender will have to justify why you are good candidate for a mortgage. These new rules will probably reduce or eliminate the lenders that will approve someone with a 580 mid fico score.

Lending requirements are tougher now since the housing market crashed. You have really got to have your credit in order to be approved. One small mistake is generally okay but when there is more than one, issues begin to arise during underwriting. It is not as easy as it used to be to qualify for a mortgage. I worked on my credit for 7 years before I was able to qualify and close this month. Some people have done it in 2 months but the time that it takes to clean everything up is very dependent on every person's individual credit profile.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! Smiley Happy Last App: 4/5/13 Gardening until July 2014
Valued Contributor
Posts: 3,302
Registered: ‎06-09-2010
0

Re: FHA loans for those with less than a mid 640...

You will have much better chances with a 620 mid score.

 

Paying down your debt will help but I do not see a 100 point gain. But I have been wrong before!

 

GW's and PFD's do not always work, and sometimes they work after a significant amount of time of trying. You have nothing to lose to keep trying for a GW for removal of paid negative debt and late payments caught up.

Good Luck
May all your dreams and wishes become a reality!
Valued Contributor
Posts: 3,406
Registered: ‎12-19-2012
0

Re: FHA loans for those with less than a mid 640...

+1
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! Smiley Happy Last App: 4/5/13 Gardening until July 2014

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