Would I qualify? Plan to get pre-approved 06/2015

[westo12]

1.      Credit.  614 TU Walmart/Barclay/Discover Fico. Score is so low due to carrying a balance on the majority of my tradelines. Plan to pay off quite a few over the next year.  Only negatives: $312 medical debt, placed 9/2010, plan is to try and PFD before applying in 2015 / 3-30 Day auto lates in 7/2012, 8/2012, 9/2012. No other lates on 24+ positively reporting paid and unpaid accounts.
2.      Income.  $57k Base annual + $7-$8k overtime pay a couple times per year mandatory + $3k-5k annual bonus.  Have received for 3 years in a row, able to document.
3.      Source of income.  Full time job
4.      Monthly debt payments.  Currently have $12,570 in revolving debt (60% util), minimum payments are $410/mo. which I plan to pay down to around 20-25% before applying in 2015. Installment loan debt $19646, my truck $384/mo + cosigned for daughter $180/mo. May try & get her to refinance that prior to applying in 2015.  At that point, I can show she's made the payments for over 12 months at that point, can the $180 be excluded in that case or no?
5.      Employment Full Time W-2 employment, will be almost 5.5 years on the job at time of application
6.      Assets/Reserves.  Savings, checking (balances tbd) assuming about $3-4k down + Simple IRA $5k will be using for down also. Plan on going FHA, or Homepath, or CalHFA with their first time homebuyers down payment assistance program, so trying to keep my out of pocket as minimal as possible.
7.      Location.  Either Contra Costa or Alameda County/California
8.      Property.  Single family house
9.      Value.  Between $250- $300k
10.    Occupancy.  Primary residence
11.    Transaction Type.  Purchase

[ShanetheMortgageMan]

For the medical collection follow the procedure at http://www.whychat.5u.com/GUIDE%20HIPAA%20PROGRAM.html ... you can also try a PFD, but that method almost always works.  Reducing your revolving debt will make a big difference too.  If you can do both of those I wouldn't be surprised if your score would get into the 660+ range.

On a co-signed debt, if the other party has been making the payments from an account in their name (that isn't in your name) for the past 12 months with all payments on time then it can be excluded from the debt ratio... so sounds like the $180/mo won't be in the picture.

With your numbers it appears you should be good for a $300k sales price using FHA or CalHFA.  HomePath may not be an option, as there have been some rumors that Fannie Mae may eliminate the program later this year, plus your debt ratio appears to be too high for HomePath anyway.

... and with that I'm going to bed.  Be back tomorrow.

[westo12]

Shane, my TU Fico from Discover/Barclay's on 5/20/14 was 649, util then was around 49%.  This month I had to save money to move & have been using my cc's more.  

I have 6 that are reporting a bal over 90%, util now 61% and I'm at 614.  I also have 2 30 day auto lates in the past two years.  I really feel like I'll be in the 700 range after I get my util down under 30% or greater and have more lines reporting $0bal.  Do you think I'm just dreaming on that?

And yes, I'm not on the account that my daughter makes her payments from, so yes, getting that excluded sounds good. 

Regarding the collection, since it's so old and under $1k, I wouldn't have to worry about it with FHA, correct?

[ShanetheMortgageMan]

It's a lot more difficult to get your score up to a 660 from a 620, than a 700 from a 660.  It's like batting averages in baseball, if you are hitting a lowly .200 then it's not difficult to increase it up to a .250 by going on a little hot streak... however to raise it from .250 to .300 you are going to need to constantly be hitting well.  So that applies with credit scores too, to get up to a 700 you are going to need very minimal negatives on credit and an overabundance of positive credit accounts.  I obviously haven't seen your credit, but with the medical collection in 2010 & the 3 auto loan late payments ~2 years ago you'd have to have a lot (like dozens) of other tradelines with positive payment history to get your scores up to a 700 by just paying down credit cards.  I'd really work on that medical collection if your goal is to get to a 700, but correct that since it's medical it won't be an issue.

[westo12]

I have 25 positive reporting accounts, only 7 are closed/paid as agreed, so does almost 2 dozen count?  I now only have 2-30 day lates (8/2012 & 9/2012, also, out of the 18 open/paying as agreed accounts, 10 of them were opened in the last year.  I really thank you for your input and I'm only responding with additional info, as I want to keep a record here so I can see in the future exactly what my score will be once I just pay down this high util and the new account dings & corresponding inquiries go away.  

Thank you again Shane!!

[ShanetheMortgageMan]

Opening 10 of them in the last year may have stunted the score increase for a little while, tough to say.  Once they get more history under them then they'll become stronger and help balance out the negatives... yes almost 2 dozen definitely will help.