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Want to buy bad credit father willing to co-sign

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Adv
Member

Want to buy bad credit father willing to co-sign

First thank for the help, let me give a little background my credit is bad due to high credit utilization and some collections that are 5-6 years old. My ex is 538 eq540 and tu is 584. I'm currently renting and it's costing me 1265 a month, which I can easily afford. I just paid off all my credit cards, and are waiting to see if the scores jump. My problem is the houses in my area are selling like hotcakes, and home pricing has increased 10% in the last 3 months. I really don't want to waste another 15k on renting and my dad he will co-sign the loan and I have about 14k for a down payment. He has great credit (770-800) and makes mid six figures. The house I'm looking at we'll within what I can afford and if I can get a good rate would be less then rent including taxes, and MI. My question is this does anyone know who would lend or how hard would it be to find a mortgage tHat will take a primary borrow with these scores with a co-signer who is more then able to buy the house? Or if my dad can mortgage it himself he does live in a different state, thanks sorry for grammar using ipad
Message 1 of 6
5 REPLIES 5
Sunshine85
Frequent Contributor

Re: Want to buy bad credit father willing to co-sign

For a lender to approve you, all borrowers on the loan must qualify. Since your mid score is 540, you wouldn't qualify- and the loan would be declined, even though your dad would also be listed as a co-borrower. 

 

Your best bet is to work on clearing up the old collections (pay for deletes)- that along, with paying off all the credit cards, will put you in great shape. Check out the credit forum for some tips on dealing with old collections. 

Message 2 of 6
Mike_B03
Valued Contributor

Re: Want to buy bad credit father willing to co-sign

Unfortunately from what I know, both borrowers have to qualify credit score wise. The only time a co-signer is really helpful is when there is a problem with the income for the main borrower. 

Message 3 of 6
Mike_B03
Valued Contributor

Re: Want to buy bad credit father willing to co-sign


@Sunshine85 wrote:

For a lender to approve you, all borrowers on the loan must qualify. Since your mid score is 540, you wouldn't qualify- and the loan would be declined, even though your dad would also be listed as a co-borrower. 

 

Your best bet is to work on clearing up the old collections (pay for deletes)- that along, with paying off all the credit cards, will put you in great shape. Check out the credit forum for some tips on dealing with old collections. 


Or just have your dad buy the house on his own and then have the title in both of your names.

Message 4 of 6
Adv
Member

Re: Want to buy bad credit father willing to co-sign

I don't have 25% most lenders look at for non occupying loans unless someone knows of a place my dad lives out if state
Message 5 of 6
StartingOver10
Moderator Emerita

Re: Want to buy bad credit father willing to co-sign

FHA allows a non-occupant co-borrower. Are your scores FICO scores or from somewhere else? You might not be as bad off as you think if you are looking at FAKO scores.

Wait until the zero balances are reporting then pull your scores again. Ideally you want to have all open cards reporting zero except one and it is to report less than 9% of your credit line. If you have closed cards with balances those need to report zero too.

 

Do you have charge offs with balances and collections with balances? Those balances will add to your utilization too. So if you can get those removed with a pfd then your score should increase. Having said that, the rebuilding forum will give you much more detail on how to remove those collections so check there first.

 

Also if your father buys the house as an investment property, you can rent from him until you can increase your scores to qualify for a mortgage on your own.

 

You don't need 25% down for investment properties. Generally you (your father) can get an investment loan for 20% down.

 

Message 6 of 6
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