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1st Timers needing some advice

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welshdan
New Contributor

1st Timers needing some advice

Ok this could get quite long so apologies in advance.

 

My wife and I moved to the US in July of 2009. I am a UK citizen with permanent residency and my wife is a US citizen.

Due to the length of time she was out of the US her credit is non exsistent and there is nothing bad on there.

Since July 2009 we have been building credit -

 

She has $300 secured orchard since august 2009 and cap one $750 since oct 2009.

Always paid on time and a very low debt to ratio.

 

Her score is around 700 currently.

 

I have a cap one for $750 since January 2010 and opened a shell gas card last month for $200.

Again very low debt to ratio and perfect payments - my score is around 650.

 

In the US I have been employed from August 2009 through June 2010, I was then unemployed for 3 months starting a new job at the beginning of September.

My wife also lost unemployement in JUne 2010 (bad month for us right!!!) and gave birth to our first child in October and currently she is a stay at home mom.

 

Our rent contract is up on our house Jan 31st 2011.

We are paying $650 and my gross income is $2000 a month.

 

We are looking for a house in the 70 to 80K area, we have $6,000 to put down (if need be but would prefer a no down payment option)

We are  desperate to pay less a month and have a place that is our own.

 

With the kind of work history and length of credit history we have is there any chance at all of us being able to buy a house in the new year, or are we doomed to another 12 months of renting?

 

I very much appreciate honest brutal answers!

Message 1 of 12
11 REPLIES 11
Anonymous
Not applicable

Re: 1st Timers needing some advice

More than likely they are going to want to see 2 years empoyment history at the same job before even considering the application.  Same goes for credit file, they will want to see at least 2 years of established credit (and with short history, it meeds to be spotless).

Message 2 of 12
welshdan
New Contributor

Re: 1st Timers needing some advice

My local credit union (Gulf Winds CU) ask for 6 months employment.......

 

But anyway say we do wait the 2 years, would you recommend an auto loan and using some of our $6k saving to pay it off within 12 to 18 months?

Message 3 of 12
Anonymous
Not applicable

Re: 1st Timers needing some advice

As far as the employment, they may have some extenuating circumstances or in house loans that allow for 6 months,  but with the limited credit history and down payment, you are likely looking at FHA and FHA is going to want to see 2 years.  It is less if you went from the same job to same job, but if there was any change in type of employment it has to be 2 years generally.

Message 4 of 12
ShanetheMortgageMan
Super Contributor

Re: 1st Timers needing some advice

If you were a non-permanent resident alien/were here on a Visa then a 2-year residency, employment & credit history in the U.S. or from a U.S. based company is required... however for permanent resident aliens the employment & credit history can span back to the former country of residence.  The 6 month requirement you are running into probably has more to do with the 3 months you were unemployed for than being a permanent resident alien, as whenever there is an extended absence from the workforce underwriters typically like to see you back working continuously for the same employer for 6 months.

 

Appears you are in the Pensacola Florida area (that is where Gulf Winds FCU is), and since your income is considered low you should certainly look into the Pensacola City State Housing Initiates Partnership program that provides up to $15k towards down payment/closing cost assistance for low & moderate income families.

 

http://www.pensacolacitygov.com/live/pages.asp?pageID=1238 has the info, including a link on eligibility requirements & approved lenders offering the program.

 

Another option would be a USDA Rural Development mortgage, which does 100% financing without any monthly mortgage insurance, but you must buy in an eligible area (typically rural), if you aren't looking to buy in the immediate area of Pensacola then it could be a good fit.  To find eligible areas go to http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do and on the left side click on "Single Family Housing" under "Property Eligibility", click Florida, etc.  It also has income restrictions (also a link on the left side of that page for), but your income appears to meet the requirements.  

 

There are two versions of USDA RD - "Direct" where you go directly to the local USDA office (also can be found on that link) or the "Guaranteed" version where the mortgage is made by a lender.  The Guaranteed version permits higher income amounts to be eligible for the program, one of the reasons it's utilized over the Direct version, but if you have both the Direct & Guaranteed version available (meaning your income fits both eligibility requirements) and you have some patience, usually the Direct version is better since your loan amount is smaller (the Guaranteed version has a 3.5% fee that is financed into the loan amount).

Free Mortgage Advice & Pre-Approvals (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
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Message 5 of 12
welshdan
New Contributor

Re: 1st Timers needing some advice

Hi Shane,

 

You are right regarding we live in Pensacola.

 

I am a permenant alien with green card, had great credit history in the UK.

 

The ship program sounds great, but the work history is killing me - those 3 months in the summer will probably scare potential lenders away?

 

My previous job which I was at for 10 months from Aug 09 - june 10 was in Escambia, does that count for anything?

 

EDIT :

 

As far as USDA that would work great for us as even though we can stay in the inner pensacola area, we can move to Pace a small city/town 5 miles outside and that is in the USDA loan area.

 

 

Message 6 of 12
ShanetheMortgageMan
Super Contributor

Re: 1st Timers needing some advice

You'll just need to be on your new job for 6 months before you'll be able to close, you can make an offer before then but would need to time closing after 6 months on the job (whoever you apply with can provide you details on when exactly you can close).  The 6 months is required due to the employment gap after your prior job... so yes, your prior job in Escambia counts, it counts towards needing to be on your new job for 6 months.  If you didn't have your prior job you probably would need to be on the new job for at least 12 months, and possibly even 24 months.

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 7 of 12
welshdan
New Contributor

Re: 1st Timers needing some advice

We were scheduled to close on our new house today by the way!!

 

We were buying a foreclosure from Fannie Mae and they kindly informed us on Monday that they had not finished foreclosure proceedings on the house from the previous owners and therefore don't have a house/title to sell.

 

So infuriating, it could be a few days to a few weeks and to think they were pressuring me into a 30 day closing (9/23) but I needed more time so opted for 45 day closing, just unbelievable.

 

At this point I want to pull out of the transaction but ach my wife is like no we love the house we need to get it!

Thankfully my wife is always right (but I don't tell her this!!)

Message 8 of 12
ShanetheMortgageMan
Super Contributor

Re: 1st Timers needing some advice

That is pretty crazy - nearly happened to me not too long ago on a home that HSBC foreclosed on, they thought they improperly foreclosed on it and it'd take another month+ to complete the transaction, but then it turned out they actually did foreclose on it properly and we closed on time.  Guess your home wasn't so lucky, but at least you know it's just a matter of waiting it out.  If your rate lock has to be extended hopefully the seller would be willing to pay for it.

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 9 of 12
welshdan
New Contributor

Re: 1st Timers needing some advice

We are scheduled to close no later than Friday November 4th.

 

Our rate lock expires on November 1st at 4.5% (hey if we get lucky we could get a better rate?)

But at this point I just want to move!

Message 10 of 12
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