Mortgage Loans

[zamiller1110]

My husband has a $160 collection from Sept 2010 that we have just paid off this week. Since it's 17 months old and is now paid off, will this still inhibit our ability to prequalify? We've paid it off so recently that it hasn't even been reported to CRAs as paid, so should I send some documentation with my prequalification showing that we paid it off? That's the only negative thing on his credit besides for the LACK of credit...but that's a totally different issue.

[ktlynn_74]

I didn't read through all the replys, so maybe this was put in there somewhere but credit score does matter, but ONLY if you have any of the things you mentioned on your first post.  The past due payments, unpaid collections/judgements.  It depends on what county/state you apply in.  Here it is 640, and they you can be approved with those things on your report.  If you have under you can't have any of those things.  HTH.

[ariannasmommy]

I have to disagree with previous posters.  My husband has 6 old charge-offs from 2006 and had one collection.  We sent a full letter of explanation with our application to explain what caused the delinquencies.  He had lost his job and at the time we lived in NJ where cost of living is absolutely absurd.  We didn't go out and buy luxuries, we fed our children and paid our rent with credit cards.  His mid score is 638 and we were approved with no problem.  

The first time buyers course only cost us $30 and I receieved an email telling me the cost is refundable if I submit my HUD1 Settlement (not sure what this is, but I will be calling them to find out).  We live in southwestern Pennsylvania and I had our cert of eligibility within 2 weeks of submitting our full application.  Thus far, it has actually been a pleasant experience for us compared to some of the horror stories I have heard.  We just found the house we want to purchase, but my buyer's agent is not familiar with the direct loan at all (she has worked with the guaranteed loan but not direct - it seems none of the agents here are all that familiar with this loan).  

I am unsure as to what our next steps are, but I have put a call in to the local USDA office as of this morning and am awaiting a call back.  I'm totally clueless about what will come out of our pockets.  I know the first year of homeowner's insurance has to be paid up front and the earnest money is out of pocket - and we will be offering the full asking price to the seller with the agreement that they will pay all closing costs.  So other than the insurance and earnest money - is there anything else that will have to come out of our pockets?  I just want to know what's coming.  

The homeowner's course was very generalized and not geared to the direct loan at all, and obviously this loan is very different from a conventional loan.  I'm having a hard time finding information about what happens AFTER the initial application and approval.  As for the subsidy - do you only receive it if you use the full loan amount?  We are approved for $167k but the home we are interested in is only $119k.  It is in move in condition and needs virtually nothing.  Our rate is set at 3.25% but our subsidized rate is 1.91%.  I'm curious if it will be 1.91% even if we don't use the full loan amount.  

[USDAdesperate]

Quick Question please:

I am helping my mother in law to qualify for the 502 direct loan she has a credit score of 645 but she only makes about 9k per year thru her SSI income.

Can she still qualify for a house that is worth about 120K.

Thank you.