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What are my chances?

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Anonymous
Not applicable

What are my chances?

I need some advice from the gurus of mortgage loans here!

 

I have been working diligently since the beginning of April to get my credit in order to apply for an FHA loan.  I started out in April with credit scores of EXP 625, TU 615, and EQ 586 (all lender pulled). I had multiple open collections (9 or 10). I have since paid everything off (except for one old Sprint PCS that I will be paying this week) and disputed some things that were incorrect. I have gotten a lot of things deleted. Currently have 4 collections left reporting (all are medical besides Sprint PCS) and they all show $0 balances.

 

I have several accounts in good standing.

HSBC which was closed back in 2004 but still reports as "in good standing".

Capital One - $300 CL reporting with $21 balance. (opened in December 2010)

BB&T - $30,669 car loan (pays as agreed, never late) (opened in September 2010)

Fashion Bug - $200 CL (never used this card) (has been open since 2001 and reports as "payed as agreed")

 

My current scores pulled from myFico are EX ? (however I expect this to be much higher now since all of the deletions), TU 676, and EQ 641.

 

I am starting a new job at the end of the month and have been at my current job for about 11 months. I have not had any lapse in employment in about 5 years. I am staying at my current job part-time as well as starting the new full-time job. My gross annual income will be approximately $65,000-$70,000 with both jobs.

 

I am interested in applying for an FHA loan. I will also be applying for down payment assistance through the state of NC. I don't have any reserves but could probably come up with a few thousand dollars in a short time if need be. I plan on asking the seller to pay closing costs. I am looking in the $125,000-$175,000 range. (really hoping to stay more towards the lower limit). Is this a feasible amount for my income?

 

Is now a good time for me to apply? I had a hard inquiry on my report in April when I initially began this process. Will another really hurt me? I am planning on applying through Quicken loans as their minimum score is 620. Any comments or concerns about Quicken? Do I need to wait and save up reserves before applying again? I will be having to commute 2 hours each way with my new job and would really prefer not to. Do I have a good chance of getting approved?

 

Any suggestions will be greatly appreciated!

Message 1 of 8
7 REPLIES 7
bigman023
Frequent Contributor

Re: What are my chances?

I could be wrong, but I beleive Quicken has ended their 620 FICO for FHA deal they had going.  I have also heard that  3 open tradelines are needed to qualify all FHA loans, and those tradelines will need to be at least 1 yrs old.  Your fashion bug is fine, but you may need to provide two alternate tradelines to satisfy this requirement.   Also, you probably have more than 1 INQ, seeing that you just opened new accounts at the end of 2010.  IMO, I think you would better your chances,alot, if you waited until Dec. 2011.

 

Im not one of the Gurus here.  But these are some of the things I have seen talked about frequently on this site.  Im sure others will confirm or correct what I have posted.

 

Good Luck.

5/2009 EQ-504(FICO), TU98-567(FICO), EX- 503 (FAKO)
10/17/11 EQ-633, TU04-652, EX-681 All lender Pulls
10/17/11 TU98-678
12/21/2012 TU98-677 (39% Util)
01/21/2012 EQ - 661 (37% Util) SW Alert
Message 2 of 8
Anonymous
Not applicable

Re: What are my chances?

Spoke to Quicken loans last week and was told that the minimum score was still 620. Hoping this is still the case!

Message 3 of 8
ShanetheMortgageMan
Super Contributor

Re: What are my chances?

Only the income from your new job will count, as you need to be employed by the same employer 2 years in order for part-time employment and it's income to qualify. Make sure all disputes are ended before credit is checked or you'll have a tougher time in underwriting. How much is the income from your new job? How much is your BB&T car loan payment? When were all of the 4 remaining collections from? Unless you have pretty good credit you are rolling the dice with Quicken, last I checked they don't have an underwriter fully review your file until you are already under contract to buy a home, and their loan officers have a reputation of being overly optimistic.... refinancing they are not a bad choice, but buying a home they don't have a great reputation. You can search for reviews by putting "Quicken" in the field in the upper right corner of each page, make sure you are in the mortgage section and "board" is selected so you get posts specific to Quicken loans and not Quicken anything else (software, etc.).
Free Mortgage Advice & Pre-Approvals (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Southern California and lending in all 50 states
Message 4 of 8
Anonymous
Not applicable

Re: What are my chances?

My new job alone annual income will be about $48,000.

My BB&T car loan was open in September 2010. Balance $30,969 and payment is $561 a month. I don't have any other debt other than the 1 CC that I keep at a pretty low balance. Right now it is reporting $21 of 300 CL.

 

All of the collection are from many years ago and are all scheduled to age off at the beginning of 2012.

 

And I had read some pretty shotty stories about Quicken. I have actually been working with Amercian Security Mortgage with all of the pre-application stuff. They pulled my reports back in April and told me what I needed to do. They require a minimum score of 640. Which I have so I think I may just stick with them. Quicken intrigued me because they have quick turn outs.

 

I am planning on using down payment assistance through the Bond program with the NC Housing Finance Agency and asking for closing costs from the seller. Should I go ahead and apply?

 

All disputes have ended. But some of accounts do say "disputed by consumer". Will I have to get all of these removed before being approved?

Message 5 of 8
ShanetheMortgageMan
Super Contributor

Re: What are my chances?

Sorry for the formatting in the last post, out of nowhere Chrome wasn't working great for me so I've switched to MSIE in the meantime.

 

Your debt ratio is a little on the high side for a $175k sales price (46%), but at $155k you shouldn't have any debt ratio issues.  But with 2 months PITI reserves you shouldn't have any problems qualifying for the $175k, as sometimes reserves are needed for those higher debt ratios to qualify (particularly if the scores aren't very high).  I've heard of American Security Mortgage, I'd say you are in better hands with them than Quicken.  I'm not sure what the requirements for that program are - if you need to have a mortgage pre-approval first, or what, but if you don't need a pre-approval and can apply for it anyway, then heck yeah go for it and reserve your funds, I've heard programs like that can take a little while for application processing.

Free Mortgage Advice & Pre-Approvals (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Southern California and lending in all 50 states
Message 6 of 8
Anonymous
Not applicable

Re: What are my chances?

I have my eye on a house. It is listed for $150,000. Would like to pay 135,000-140,000 for it. I don't need a pre-approval. My real estate broker is a close friend and there are no stipulations on the property for preapproval. The programs only requirement is for you to live within their selected areas, meet income limits, and be using one of their approved lenders for financing. When you calculate my DTI ratio is that using the assumed mortgage payment? Hope I understand this.  I am guessing that the downpayment and FHA combined may take a little while. Can I go under contract on a house and do say a 60 day close now. Giving them time to do the processing?

Message 7 of 8
ShanetheMortgageMan
Super Contributor

Re: What are my chances?

Yes it includes the proposed housing payment.  It'd be up to the seller if they'd want to accept a 60 day closing, if you find a seller who doesn't need to sell yesterday then it should be possible.  Again, just depends on the circumstances.

Free Mortgage Advice & Pre-Approvals (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Southern California and lending in all 50 states
Message 8 of 8
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