New mortgage reality

Anonymous · ‎08-27-2008

I always end up with a mid FICO around 620....and have purchased several homes over the years with no problem getting a 30-year fixed conventional. I now am relocating and will purchase again. I know a lot has changed and lenders are much less willing to loan money. I am looking at an approx 400k home...with 10% down...and suspect I'll still be a 620 middle FICO. How much trouble will I have on this now?

BrianB_The_Loan_Professor · ‎08-27-2008

Hi Sean welcome to the forum

A 620 with less than 20% is a prime candidate for a FHA loan

You should be fine provided the income is solid and the recent credit clean

Conventional will kill you on rate and SubPrime is gone so the options are definitely limited

Also I hope you arent self employed and if you are that you dont write off everything as stated loans are gone too

Brian

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Brian B The Loan Professor
Mortgage Banker - offering FHA, VA, USDA , and Conventional mortgages in all 50 states -

If I do not respond to a follow up question please feel free to contact me directly

DallasLoanGuy · ‎08-27-2008

what state and county? are you within fha limits?

Retired Lender

Anonymous · ‎08-28-2008

Hi Guys, I've been following this website for awhile and recently signed up for the service. I'm in the process of taking a loan to buy a house (first time home buyer). I've always had my eye on the credit score to make sure nothing is wrong. Sometime in 2006, I hit a 830 score which has been the highest for me, but due to some miscommunication from my cell phone plan (changed providers & moved addresses, but there was $12 bal due which they sent to a collection agency since I didn't respond and I finally settled it for $65), and I'm guessing cos of this, my score dropped to 720 in early 2007. I've been working on getting it back and I finally see my score around $786, 782 and 773 with all 3 agencies ( the cell phone fiasco does not show in any reports).

My question is, does 800 + vs a 750 really make a difference. In terms of interest rates, do you think I can still get the best available rates (assuming the rest of my credit file is good employment, cash flow etc). Looking to buy a place in California and the housing market really sucks cos the house prices are still holding up in San Francisco and every percentage point does have an impact on the payment.

Anonymous · ‎08-28-2008

I want to say that once you cross the 760 region, it makes no difference how much higher you are. I think Dallas recently said that currently 740 will yield you the highest results. With your scores, I would kill myself trying to climb them higher, you are in tip-top shape!

DallasLoanGuy · ‎08-28-2008

JM30 wrote:
Hi Guys, I've been following this website for awhile and recently signed up for the service. I'm in the process of taking a loan to buy a house (first time home buyer). I've always had my eye on the credit score to make sure nothing is wrong. Sometime in 2006, I hit a 830 score which has been the highest for me, but due to some miscommunication from my cell phone plan (changed providers & moved addresses, but there was $12 bal due which they sent to a collection agency since I didn't respond and I finally settled it for $65), and I'm guessing cos of this, my score dropped to 720 in early 2007. I've been working on getting it back and I finally see my score around $786, 782 and 773 with all 3 agencies ( the cell phone fiasco does not show in any reports).
My question is, does 800 + vs a 750 really make a difference. In terms of interest rates, do you think I can still get the best available rates (assuming the rest of my credit file is good employment, cash flow etc). Looking to buy a place in California and the housing market really sucks cos the house prices are still holding up in San Francisco and every percentage point does have an impact on the payment.

please start a new topic.....

Retired Lender

DallasLoanGuy · ‎08-28-2008

UpUpUp wrote:
I want to say that once you cross the 760 region, it makes no difference how much higher you are. I think Dallas recently said that currently 740 will yield you the highest results. With your scores, I would kill myself trying to climb them higher, you are in tip-top shape!

sometimes the difference in scores = .125%

when i mention something like that, it is relataive....

Retired Lender

Anonymous · ‎08-28-2008

620 score will cost you 2.25% to the fee, which translates into a rate of around 6.875% with an FHA loan

Anonymous · ‎08-29-2008

Sorry.. Didn't mean to steal the thunder !! I will start a new post.

Anonymous · ‎08-30-2008

DallasLoanGuy wrote:

UpUpUp wrote:
I want to say that once you cross the 760 region, it makes no difference how much higher you are. I think Dallas recently said that currently 740 will yield you the highest results. With your scores, I would kill myself trying to climb them higher, you are in tip-top shape!

sometimes the difference in scores = .125%
when i mention something like that, it is relataive....

Gotcha, thanks for the clarification.