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@Melusina wrote:
I am a single mother of a 5 year old looking in to becoming a first-time homebuyer. I have a credit score of 588. I have been at my job in the medical field for two years.
My gross income is $1400/month. My ex pays child support of $300/month. My monthly expenses total little over $1,000.
I have no credit cards and never had. I do not own a vehicle at the moment but have access to my parents vehicle. The biggest hit to my credit happened 4 or 5 years ago when I co-signed for a vehicle with then husband and then had to return vehicle due to hardship. I have a bank account with direct deposit but nothing in savings or any other assets.
I live in the St. Lucie County of Florida and am wanting to purchase two bedroom and two bath home for myself and child in the same area that could range from $40,000 - $100,000.
What are the first steps would I have to take?
What kinds of loans would be helpful to me?
What agencies or associations cater to first time buyers?
Are their possible grants offered for my case? Where would I go to receive them?
Thank you in advance for your response.
The biggest problem that I see is DTI. You are currently at 59%, so you need to work on getting your income up or your expenses down. How much of that $1,000 per month is current housing costs?
You'll also need to work on getting that score up, but until the DTI problem is solved the score is a secondary concern.
@Melusina wrote:
I am a single mother of a 5 year old looking in to becoming a first-time homebuyer. I have a credit score of 588. I have been at my job in the medical field for two years.
My gross income is $1400/month. My ex pays child support of $300/month. My monthly expenses total little over $1,000.
I have no credit cards and never had. I do not own a vehicle at the moment but have access to my parents vehicle. The biggest hit to my credit happened 4 or 5 years ago when I co-signed for a vehicle with then husband and then had to return vehicle due to hardship. I have a bank account with direct deposit but nothing in savings or any other assets.
I live in the St. Lucie County of Florida and am wanting to purchase two bedroom and two bath home for myself and child in the same area that could range from $40,000 - $100,000.
What are the first steps would I have to take?
What kinds of loans would be helpful to me?
What agencies or associations cater to first time buyers?
Are their possible grants offered for my case? Where would I go to receive them?
Thank you in advance for your response.
You need to get at least two credit cards, but I heard 3 is the magic number for a really good score. You need to have revolving credit and an installment (car loan, student loans,etc). Lenders like to see mixed tradelines. That is why your credit score is the way it is. I was like you, no credit cards at first, but I started to read the posts in the rebuild credit back in 12/12 and I noticed why I was not getting the 640. After the credit cards, that is when I saw a big jump. I kept 1 card with a utilization of 4%, and the other card has a balance of 0.
2)I took the homebuyers class to get the downpayment assistance, every state has one. Also check your city's downpayment assistance programs as well it can aid in downpayment and closing costs especially in areas that they are trying to rebuild.
3)Start saving, especially if you going to be looking at houses in the 40K-100K range. The average costs with closing is about $5K or less. That is assuming if the seller is not helping. Keep in my home inspection fee's and prepaid costs (homeowners insurance, escrow, etc).
4)If you monthly expenses is a little over $1K, I would open a savings account and put that child support payment in there, and keep the other $400 in checking.
Good Luck