Am I ready to buy now? Or wait a bit?

[Anonymous]

Am I ready to buy now or later?

I will be a first time home buyer, don't know everything I need to know about homebuying, but I am a quick study. My credit has been steadily improving after years of negligence and ignorance (I wish I found this forum earlier!) Time and finally being able to live within my means has helped the FICOs. Anyway, I wanted to know, before I start actively looking for a home and mortgage, what opinions here are. Am I ready to buy or should I wait another year or so and continue to work on improving my FICO scores and CRs by hopefully clearing a few BADDIES,and adding new CCs/TLs and credit reports. I can also take more time to save for down payment, closing costs etc. What kind of mortgage should I qualify for now? Will I qualify at all?

Here are my details:

I'm looking for a home and morgage for $100-125K. I would prefer little or no down payment.

My middle FICO score is 730 (TU)

BADDIE: I have two lates on an auto loan, back in 2001. Loan is PIF, and have sent GW to the lender.

BADDIE: I have only one open and reporting TL, a CC with limit $500, which I usually PIF monthly.  I can ask for a CLI if that would help. 

The above mentioned auto loan is my oldest account on my CRs....opened in 1998.

BADDIE:  Collection for $41 circa 2004/2005.  Am trying to sort it out now with DV, then will PIF/PFD.  Will PIF anyway, but if they don't accept PFD will GW CA and OC.  Don't know if that will help as the CA is not known for being helpful with this. 

I earn $57,000 annually. Same employer  since 1992.

I have about $12,000 in savings right now that can be used towards the purchase of a home.

While I have enough cash saved to buy a new small auto without financing, I thought maybe I should get an auto loan. That would increase my debt, but open another good TL. I don't know which would be better. Keeping my debt low by buying car cash, or getting an auto loan to open another TL to establish more credit.  I do need a new vehicle soon as mine is now approaching 10 years old now.

I don't think the housing market (New Orleans Metro Area)  in my area is quite the same or as bad  as the rest of the country due to post-Katrina affordable housing shortage.   However, I did read somewhere that sometime during 2008 is when things will bottom out so to speak.  But, I'm not sure about all this. 

Any advice, comments and critiques would be much appreciated.

Message Edited by CommanderK on 12-29-2007 12:03 PM

Message Edited by CommanderK on 12-29-2007 12:20 PM

[Anonymous]

your score should get you any type of mort you want. i wouldn't app for anything if you are within 6 months of getting a mort.

your lates should be going away soon and are not likely having a real impact on your score.

if you have a home in mind i think you could walk into any lendor and pretty much set your own terms.

[Anonymous]

Thanks for your reply.  But, OOPs!  I left off one big BADDIE somehow lost in the cut/paste I did from WORD. 

It's a collection on another report for $41 circa 2004/2005.  Something I disagree with, and have sent a DV.  Will PIF/ PFD once they verify, and if they wont accept will PIF anyway, and GW the CA and OC.  I have heard this CA isn't very helpful in this area.  How badly will a PIF collection for only $41 (showing on another report, not report with middle score) affect things too? 

Will edit original post to reflect this BADDIE too.  Must have been wishful thinking when I omitted it. 

[Anonymous]

when do you plan on buying. with your scores where they are i would let the mort underwriter make the call. if something needs to be paid as a condition to close they'll cut a check at closing. if you are unsuccesfull w/pfd, or gw attempts you could run the risk of having the baddied update and it will drop your scores due to "recent collection activity".

[Anonymous]

Auto loan will do little, if any, good for FICO. Pay cash.

saladdin

[ShanetheMortgageMan]

You look to be in pretty good shape for the house price range you are looking at.  Since all of the negatives were over 2 years ago you shouldn't have any lender give you any slack on them, wouldn't even be required to pay the owing collection off.  I would hold off on applying for auto financing, the trade line woudln't be old enough to make an impact, plus it'd add a monthly payment to your debt-to-income ratio (which looks great by the way).  I'd talk to a lender or broker who has access to both FHA & conforming, so you can evaluate all of your options.