I made a lot of mistakes when I first went to college with my credit, I did not know how to manage my credit and charged up a few cards and fell behind on paying them. I went into a debt management program in 2009 with all my cards except for my student loans and car loan. In April 2013 I finished paying off all my credit cards and applied for 3 cards to rebuild my credit. I also took out a new car loan with a low APR with my credit union around the same time. In January 2013, my credit was pulled by a mortgage company that a landlord was using to rent out an apartment my scores at that time was Equifax 676, Experian 649, Transunion 640. I signed up equifax scorewatch and it shows my current score as 651. The balance on my new car loan is $42,000 with a monthly payment of $700 + $50 disability coverage/month, only made 3 payments so far and its up to date with no late payments. My student loans are in deferment because I am currently enrolled in a masters degree program which I am paying cash for (no loans) and with an employers tuition reimbursement. I currently have a CC from my credit union with a $500 limit which I pay off at the due date (took it out to help my husband also build his credit, he just got issued a SS# and has 0 credit), I also took a homedepot card for a purchase and paid it off within 3 months under a 0 APR promotion. I currently have a chase freedom card $3500 limit, $2000 balance which will be paid off in a month.
My score watch shows 3 inquiries in the last 2 years which is inline with the current new accounts I have opened. It says I have 9 negative accounts but they're the accounts I paid off in the credit management program and they all show as 0 balances. It also shows a collection account which was last reported on 04/19/2012 with a 0 balance, it was t-mobile bill for $ 678 that was sold to a collection agency, I settled it for $406 and it's listed as a paid collection.
I have a salaried income of $88,000 hut have averaged about $105,000 in the past 2 years. I've been with the same employer for 6 years and in a stable unionized job. MY DH has no credit history. He just got his greencard about a month ago and has only been working the past month and only earns a gross of $1920/month so I wont be including his info on the loan app.
I recently decided that I wanted to own my own home. There's a new construction townhouse complex that I am interested in, I am interested in an FHA loan and I have the 3.5% down payment now. I am working on saving up for the closing costs, the builder has a $7500 incentive if you finance with any of their two banks if you buy in the first phase of their construction by November. My lease ends at the end of January so if I'm able to purchase and close before the end of decemeber then my first mortgage payment will not be due till Feb 2014. I am also ok in buying in the second phase because it has the unit that I really want and also my credit profile will hopefully be where it needs to be to secure a loan, so I can always get a month to month lease and move when I purchase.
My question now is that with this brief synopsis of my credit profile, will qualify for an FHA loan? The home is $300,000. I am interested in using the builders bank (Wells Fargo) so I can get the incentive to use towards closing costs. I have not applied yet but plan to apply in October if my chances are good on securing a loan. At that time my CCs will all be paid off and my student and car loan installments will be my only revolving debt $750 +$195 (in deffferment till 01/2014) = $946/ month.
Is it advisable to purchase now or wait till later?
What can I do to improve my FICO score? I want to be in the 700 range prior to loan application.
I am new to this site and value all your insight. Thank you very much in advance!!!1
