01-16-2013 01:21 PM
My wife and I are hoping to purchase a home this summer. We are looking in the $350,000 to $400,000 range.
Situation is this:
We'll both probably have credit scores in the 720-730 range by then. We're both in the high 600s right now, mostly due to high utilization ratio that I'm taking care of as much as I can.
My student loan payments are high - $1,600 a month - but our DTI ratio will be quite healthy because our household income is $205,000 or so. Only one car payment right now, which helps.
I'm wanting to get a mortgage with just 3.5 percent down - FHA obviously.
Thoughts and experiences? I guess I'm trying to figure out, among other things, when to stop paying money into lowering my credit utilization and start saving for the down payment instead. At what point will our credit scores be good enough to qualify? Is there a magic number?
01-16-2013 01:32 PM
I thought you have to have 20 percent for a conventional?
I didn't realize that your FICO could be that low. I've read all this stuff out there about people with 740s being turned down.
01-16-2013 01:40 PM
LOL where are you reading that!! You have come to the right place.
FHA is 3.5 percent down, Conventional is 3 percent down.
FHA you will pay a high PMI payment every month, Conventional you can get around it. So its the way to go if you have the score.
01-16-2013 02:39 PM
I was told by my credit union by the mortgage department that FHA is 640 for score with a 3.5% downpayment with interest of 3.75 and a conventional is 680 credit score with 5% down payment with interest that will vary.
Forums posts are not provided or commissioned by FICO. Forums posts have not been reviewed, approved or otherwise endorsed by FICO. It is not FICO's responsibility to ensure all posts and/or questions are answered.† Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.
* For complete information, see the terms and conditions on the credit card issuer’s website. Once you click apply for this card, you will be directed to the issuer’s website where you may review the terms and conditions of the card before applying. While myFICO always strives to present the most accurate information, we show a summary to help you choose a product, not the full legal terms - and before applying you should understand the full terms of products as stated by the issuer itself.
IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more
FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.