I was planning on waiting a few months before applying for a mortgage because I have a couple of things that could mean manual underwriting if I apply now BUT I may have found a home I'm interested in.
This house is in a USDA approved area. I found out at the end of last week that I'll be getting a raise as of September 1 but I don't know how much. I'm also going to be teaching a class at the local university in the Fall although this won't necessarily be "regular" income year after year.
1. Should I just wait until I get my raise to apply and possibly lose out on this house?
2. Should I try to find out from HR what my raise will be and get a letter stating my income will rise from $X to $Y?
3. At the end of the day, my DTI would be fine either way for this particular house because it's really cheap.
- My current DTI (with no housing payment) is 18% (car & student loans under IBR).
- With 100% financing on this home my DTI would be about ~26%
- I'd probably want to be approved for more just in case this home didn't work out - it's a fixer-upper priced at $50k so if it needs way more work than I want to do I'd pass. I've mostly been looking in the $80 - $130k range as $130k would put me at ~36% DTI (with my current income).
SCORES:
So in June my FICO scores were EQ 672| EX 655| TU 683 and then I was upgraded to EQ 08 which was 647 then dropped to 642.
I just checked my EQ 04 score on the Equifax website and it is 661.
Barclay's has my TU 08 at 637 (and Fico had my TU 98 at 683 in June). No idea how my TU 04 would be scored.
I *think* my middle score will be above 640, but I've read so much about massive discrepencies, I just don't know.
I guess I really won't know the actual scores until I get a lender pull. I don't think there's much I can right now for an immediate boost. I did have my CCs reporting ~9%, but then had a large(r) expense so they're reporting at ~19% right now. One of them I just paid off to $0. I can pay another off to $0 and another to 15%, leaving them at ~7%. Thing is, two of them just updated today so even if I pay them down, they won't report again until 8/14.
The other, that I just paid to $0, should report in a couple of days.
Trying to find the "perfect" time to apply is frustrating! I've held off for three reasons:
1. I've been living with my dad who has dementia and I just don't know when he'll need to go into a home. I think in the next 6 months.
2. I had a FC that finalized in 2/12. There *were* extenuating cicumstances, but I know to avoid lots of extra paperwork, I should wait until 2/15.
3. I had debt I needed to pay off. This is now all done.
Wow. Sorry for the long post! If you made it this far you're a champ!
Starting Score: 2/2013 EQ 535
Thanks EZdriver! I know . . . 
The house is a FSBO. They've been trying to sell it for a while so I don't think they'll sell within the time it takes me to see if I can get a mortgage. It is a fixer so my interest is primarily contingent on an inspection. I can handle cosmetics and some minor repairs, but don't necessarily want to deal with foundation issues for example.
I'm contacting a lender who does USDA loans to see if I would even meet that banks overlay. If I don't, well, I'll just wait. I realise they'd need to pull my credit to know for sure, but if they won't touch someone less than 3 years from foreclosure than I see no reason to formally apply.
I went to see the house his evening (only had photos before) and yeah, I love it. It's a 1905 farmhouse with super high ceilings and shiplap walls! Needs a bunch of work, but I'm okay with that as it IS liveable and I can do the work over time. So now I really want to app, but am afraid of disappointment!
Contacted a local bank, but didn't hear back today. I guess I'll call tomorrow. Wondering about companies like USDA loans and USDA loan direct and similar. Anyone know anything about them?
Thanks Brian,
it it is old but is being lived in and is certainly not falling down. It had a new roof 3 years ago, all new windows 4 years ago, a new kitchen. Electric wiring was updated and it has central AC although needs a new unit. Mostly it needs cosmetic repairs and a new porch. Unless there's a major foundation issue I don't think it will be a problem.
I've found some more local lenders that do USDA so will try them - I think you're right about the search engine optimization for the others I mentioned!
