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I have been taking positive steps to get my credit ready for home ownership. My finances are in order, stable job, and I am financially prepared. My only issue is that I have no idea where to begin, Ive seen different things about different types of mortgages. My score below is outdated, but I will be over 640 on all three CRAs in 6 months (I have recently paid CC collection/judgement, lowered util to zero, added to my avail credit, and had items deleted)
My concern is, being disqualified for a FHA/USDA even if I meet the score requirement. I have two negatives on my report, both are over 5 years old. I have paid one of the baddies, but owe a medical collection for 7k that will fall off dec 13. I have never been able to get information from them, its in dispute as of now.
Also, after about 3 years after the CO CC, they filed a judgement. Its satisfied, as of this week, and was initially reported 18 months ago.
With these two things in effect, do I have ANY options to get a home in six months. My DTI is 2%, no lates for 2+ years, everything negative is very old (except judgement, although its from an old debt) and from a dumb 18 yr old child. Im now 25, very responsible with the ability to afford and pay for a home, although I can see why I wouldnt be approved and am not saying I deserve to be, just hoping there is something for me out there.
Basically, do I have options to buy a house with those 2 negs and a score over 640? I am willing to pay a higher interest rate, more down, etc. as long as im building equity and not throwing my money away on rent. Not sure where to begin or when to begin.
I would wait until the medical collection falls off, as it would suck for them to require that to be paid when it is about to come off your reports. Other than that, I think you would qualify credit-wise. I had a judgment (satisfied) 2005 BK and 11-14 paid medical collections and I was approved for an FHA loan.
@Booner72 wrote:I would wait until the medical collection falls off, as it would suck for them to require that to be paid when it is about to come off your reports. Other than that, I think you would qualify credit-wise. I had a judgment (satisfied) 2005 BK and 11-14 paid medical collections and I was approved for an FHA loan.
I will pay it if I have to. I just didnt know if they would even consider me if it was paid or not. Im hoping I can get it removed via dispute. Ive heard medical collections are usually easier, but its an invalid amount and they refuse provide me a statement saying what I was charged so much for. It was an E.R. visit, Ive never heard of xray and blood test costing that much.
Hopefully I can get around not paying it, but the money I would pay them will be worth it. I get sick every month handing over a thousand dollars in rent, when I'll have nothing to show for it.
What about USDA? does that require I pay it off or would the judgement mess that up? Any other types of loans or lenders that might work with my situation?
it doesnt fall off in six months though, it falls off december 2013. it is past SOL, so no legal action, and I was under the impression that disputing doesnt do anything?
What do you mean, "wake a sleeping giant"? Ive called and talked to them several times, and every time i tell them that they will never see one cent from me unless someone can tell me what I paid so much money for.
I will look into opting out, Ive never heard of it or what it does so ill check that out.
I did want to get a house in 6 months, but that isnt looking possible. I read an article that FHA reg changed a month or so ago, stating that, Yes, you do have to pay any collection over 1000. bummer for me :/
You can always offer a PFD on the medical bill. Perhaps you can negotiate a lower amount to pay and they will either delete or at least update your report with PIF. That way you can still apply for your loan if need be.
ive been researching usda credit guidelines, Ive found a few referencing that you cant have unpaid collections, late payments in the past year, etc, but they say that if your score is above 620 you qualify for streamline underwriting where this is not required. Im looking to see if anyone has had this experience and am i reading this correctly?
Here is what Ive found:
USDA Home Loan Streamlined Underwriting Criteria (620 Credit scores and higher)
For borrowers with a credit score of 620 or higher, lenders may use USDAs streamlined underwriting guidelines, to evaluate the loan.
@PRC wrote:You can always offer a PFD on the medical bill.
Why would he pay on a medical bill where the SOL has run out AND he has no idea what it is for, the CA can't verify it?
I say:
1) keep your money
2) if the CA can't verify what the amount is for, AND refuses to take it off your credit, WRITE to the FTC and lodge a complaint.
I've recently done the same with an energy company and the CA who is trying to collect on a debt that is non-existant. I finally wrote a complaint to the FTC, outlining what steps I've taken to resolve the issue, the reticence of the CA to remove the wrong information.
It can't hurt (I hope!).