FICO & Bankruptcy & First time Home buyer...? Please note below

[pokerpro]

Hello everyone - I have been reading quite a bit on the different experiences, and I was hoping to get some insight or even run into people with similar background

I had an unfortunate joint bankruptcy bank in 2004. I managed to pull my credit back and have a roughly 680 average FICO score, between Experian and Equifax (august 2008) i have yet to pull transunion.

Now i am married, My wife has a much better credit history with hardly any delinquencies -

What will happen if I try to qualify for a first time home buyer loan? I mean do i go through my bank or avoid them cause of the bankrutpcy, or I have no worries since credit score is higher now

Also, credit card utilization is less than 10% and we live with the inlaws so no Rent to pay

Message Edited by pokerpro on 08-20-2008 02:12 PM

Message Edited by pokerpro on 08-20-2008 02:13 PM

[BrianB_The_Loan_Professor]

Your BK is far enouugh in the past that you should be fine for an FHA loan

Provided you can document income and youru ratios are in line the BKshould not play a major role

Broker or bank it shouldnt matter.

Good Luck

Brian

[pokerpro]

Brain - Thank you so much for your input. I am glad to know that my successful turn around with credit wont go unnoticed cause of the bankruptcy 4 years ago

quick question if I may

- do they take the mean credit score combined between my wife and I, which would help since she is higher on the average?

- what are the ratios so i can better assess where I am??

[Anonymous]

I believe they will use your mid score.  The never take an average.  They use the middle of the three scores.  Also, they will use the middle score of the lower person on the loan if it is joint.

[pokerpro]

in that case maybe we should apply in her name only, but how can my income be considered in that case??

[Anonymous]

as for scores- a mortgage company looks at the lowest mid score, so if your mid score is lower than your wifes - then it might make it harder for the both of you to  get a loan.

But your scores seem like you have made a good effort to rebound, so it shouldnt make that much of a difference.

When you are ready to apply for a loan- i would recommend calling around to a few different places, you should try your own or another local bank, a local and open credit union, a big mortgage company and a small mortgage company. Each one of those places i mentioned writes , and sells mortgages to a different market , so they may be able to offer different programs,and with that - they may be able to offer different rates and terms.

But when you make the first call for a mortgage approval- make sure they offer fha loan, and after they run your credit - get a answer on rather or not you qualify for a fha loan or not, and make sure they did a actual fha qualification run through (not just their personal word).

If you qualify for a fha loan- then you will should qualify for any loan, so use that a bargaining point if you decide to call any addittional banks or mortgagers.

On the other hand if you do not qualify for a fha mortgage - then you probley need to start working on repairing your credit.

[BrianB_The_Loan_Professor]

They will go off of the lower of the two middle score.

As far as ratios

Housing 33% of gross

tottal 41% of gross

There can be some exception to this with an automatetd approval butt those are the basic guidelines

Good Luck

Brian

[Anonymous]

your income can only be considered if you are on the loan.  Also, if you are in a community property state and are going FHA then both of your debts will be counted regardless of who is on the loan.

[pokerpro]

mikie - thanks for the insight

we live in NY and looking at both NY and CT

its good to know that I might be able to go for a FHA loan, get both incomes counted, but only use her name on the loan with the higher credit score and no record of bankruptcy

[Anonymous]

You misread.  It is the opposite.  If the state is a community property state, they will count only the income of the person on the loan, but the debts of both parties for FHA.  If it is not community property state then they will count only the one on the loan.