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House loan question: Good credit with no income

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New Contributor

House loan question: Good credit with no income

My husband and I both agree we would like to own a home.  We have the down payment but credit is the question.  I have a good score in the 710-760 range.  He however has a less then perfect score around 610-650.  I would like to spend the next year cleaning up his credit, where he would like to purchase now.  He seems to think that my score would even be considered.  I disagree because I am a SAHM with no income.  I don't think my credit even matters.  Does it?

Message 1 of 29
28 REPLIES 28
Valued Contributor

Re: House loan question: Good credit with no income


@Hopeforchange wrote:

My husband and I both agree we would like to own a home.  We have the down payment but credit is the question.  I have a good score in the 710-760 range.  He however has a less then perfect score around 610-650.  I would like to spend the next year cleaning up his credit, where he would like to purchase now.  He seems to think that my score would even be considered.  I disagree because I am a SAHM with no income.  I don't think my credit even matters.  Does it?


If you are on the loan your credit matters. If you are in a community property state your credit matters.

You have numbers in ranges for scores, where did you get your scores from? If you let us know where you obtained your score, we can give you a better idea.

 

If they are FICO scores, then maybe still qualifiable scores, have to know the middle scores?

 

How much is yearly income?

 

How long employed?

 

How much debt are you paying out monthly?

 

What type pf debt is it? (Such as car payments, CC's, etc etc)

 

How much is the home you are looking at?

Good Luck
May all your dreams and wishes become a reality!
Message 2 of 29
New Contributor

Re: House loan question: Good credit with no income

We both haven't looked at our scores in a year, so it's an estimate from an online calculator. His was 650 and mine was 720 before financing our car. I'm going to pull them again soon.

His W2 was 36,000 and 1099 4,800. He's been employed at his job 3 years.

The car is 441 a month. It was 26,000 at signing down to 19,898. Cards are total 102, student loans 50 a month.

I personally would like a house for no more than 70,000 and he's thinking 100. At 70 we have 10 percent down.
Message 3 of 29
Valued Contributor

Re: House loan question: Good credit with no income


@Hopeforchange wrote:
We both haven't looked at our scores in a year, so it's an estimate from an online calculator. His was 650 and mine was 720 before financing our car. I'm going to pull them again soon.

His W2 was 36,000 and 1099 4,800. He's been employed at his job 3 years.

The car is 441 a month. It was 26,000 at signing down to 19,898. Cards are total 102, student loans 50 a month.

I personally would like a house for no more than 70,000 and he's thinking 100. At 70 we have 10 percent down.

If you have a clean history since you pulled them a year ago then they shouldnt be worse, unless you applied for a lot of new credit.

I would just pull the Equifax score and TU score from here, for your Husband. The Equifax will be probably exact to a lender pull, and yout TU will have some variation as they are different scoring models. But on these two scores from MYFICO you can get a very good idea if your scores will qualify.

Good Luck
May all your dreams and wishes become a reality!
Message 4 of 29
New Contributor

Re: House loan question: Good credit with no income

I thought the car loan would bring it down, but we do pay more on it most months.

Oh and we don't live in a community property state.
Message 5 of 29
Valued Contributor

Re: House loan question: Good credit with no income

Really depends on what else is on reports.

 

You take a hit on scores for INQ and new account, but it is short lived. Also if you had no open installment loans you could have actually seen a boost in scores since it added to your mix in credit. Obviously YMMV, but in my opinion even if impacted your scores, it should be recovering back to original scores between 6 months to a year, pending nothing else is reporting negatively to impact your scores, and you been paying all your bills on time.

Good Luck
May all your dreams and wishes become a reality!
Message 6 of 29
New Contributor

Re: House loan question: Good credit with no income

Ok, thank you. There shouldn't be anything negative for the past three years, but he did place student loans into forbearance. I just think another year of paying on the car would do his credit good. Guess I'll pull reports tomorrow.
Message 7 of 29
Valued Contributor

Re: House loan question: Good credit with no income

Installment loans (car payments) really dont have much of an impact in scoring.

 

Your revolving debt (CC's) has a much bigger impact.

 

I think if everything is up to date and on time since your last pull a year ago, with all things being the same, your scores would be the same or better since last pull.

Good Luck
May all your dreams and wishes become a reality!
Message 8 of 29
New Contributor

Re: House loan question: Good credit with no income

I thought auto loans meant more so I've been putting more on that and minimum on cards that have balances. Is charging and paying in full better than just leaving them open untouched?
Message 9 of 29
Valued Contributor

Re: House loan question: Good credit with no income

For scoring purposes it is best to have all cards but one have a 0 balance when statement hits.

 

Example..

 

You have 3 credit cards

 

Card 1--- 500 limit

           --- 200 balance

           --- 30 minimum payment

 

Card 2 --- 1000 limit

            --- 150 balance

            --- 30 minimum payment

 

Card 3 --- 1500 limit

            --- 50 balance

            --- 30 minimum payment

 

Pay off card1 in full as soon as you can.

Pay off card3 in full as soon as you can.

Pay down card2 to keep a balance from 5 dollars to 90 dollars I opt for 5 - 50 dollars monthly.

 

This does not mean you cant use your cards, it just means to pay 2 of them off before the statement hits, and keep the 3rd card with a balance of 1-9%.

 

If you handle this properly it gives you the best scoring situation. Also if you pay the balance on the third card in full when statement hits you are not charged interest. You just make another small charge to keep that small balance reporting from month to month.

Good Luck
May all your dreams and wishes become a reality!
Message 10 of 29
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