need mortgage advice from shane!!!! (also anyone that can help) please help!!

[Anonymous]

Hi Shane and anyone that can help,

I have reviewed your posts and they all seem extremely helpful.  Here is my situation, I checked my credit score and it is listed as 550 by Experian, and 565 by TransUnion.  I incurred small credit card debts, one doctor bill, and a couple of utility bills along the years, all while in undergraduate and lawschool.  (note:  all these accounts were placed in collections because of various personal reasons)  I have sucessfully paid off all but 2 accounts, and these accounts will be paid off within the next 2 months.  I have had jobs over the past two years but all were summer jobs, i.e. summer associate at a law firm and then back to school to continue my studies.  I really am looking at buying my first house within the next 6 months and will have at least 6000 saved up in savings and about $1632 in savings.  (I'm looking at a house that is around 90K).  I graduated from law school in May 2007, passed the bar exam, and began my current job in November 2007 making $48,000/year.  My total debts are about 80,000.  I have one credit card I recently opened that's in good standing (but I read somewhere that it takes 90 days for that to reflect in your credit score).  My total debts, not including any type of mortgage every month, including credit card payments and loan payments (which begin repayment in January 08) are $440/month.  I have a couple of problems, the really low/bad credit score, my past collections and my lack of job history.  What should I do?  Can you please assess my chances of obtaining a mortgage?  Am I kidding myself into believing that I can get a mortgage, especially with the tightening of credit in the financial markets?

P.S.  Any advice would be greatly appreciated

[Anonymous]

---

msjdpitt wrote:

Hi Shane and anyone that can help,

I have reviewed your posts and they all seem extremely helpful.  Here is my situation, I checked my credit score and it is listed as 550 by Experian, and 565 by TransUnion.  I incurred small credit card debts, one doctor bill, and a couple of utility bills along the years, all while in undergraduate and lawschool.  (note:  all these accounts were placed in collections because of various personal reasons)  I have sucessfully paid off all but 2 accounts, and these accounts will be paid off within the next 2 months.  I have had jobs over the past two years but all were summer jobs, i.e. summer associate at a law firm and then back to school to continue my studies.  I really am looking at buying my first house within the next 6 months and will have at least 6000 saved up in savings and about $1632 in savings.  (I'm looking at a house that is around 90K).  I graduated from law school in May 2007, passed the bar exam, and began my current job in November 2007 making $48,000/year.  My total debts are about 80,000.  I have one credit card I recently opened that's in good standing (but I read somewhere that it takes 90 days for that to reflect in your credit score).  My total debts, not including any type of mortgage every month, including credit card payments and loan payments (which begin repayment in January 08) are $440/month.  I have a couple of problems, the really low/bad credit score, my past collections and my lack of job history.  What should I do?  Can you please assess my chances of obtaining a mortgage?  Am I kidding myself into believing that I can get a mortgage, especially with the tightening of credit in the financial markets?

P.S.  Any advice would be greatly appreciated

---

There are loan programs like FHA that care more about if you paid your bills on time the last 12-24 months than scores.  Your biggest problem most likely with any program might be the fact you just got your first ful time job.  You might have to work there atleast  1 year before a bank considers your income

[dangphuocloc72]

with your score I think you better take time and save money in 3 years , then you good to go . don't hurry . and don't hurt yourself .

[ShanetheMortgageMan]

Since you graduated and went into a job directly related to your studies, and since it's full time, you can immediately use the job & it's income to qualify.  How has your credit been in the last 24 months?  Any new derog marks or are all of the derogs happened over 2 years ago?

[Anonymous]

Hey Shane, my username changed from mspittjd to lawandproud, some complications in logging in.  I don't know if I said this in my previous post but I think my credit score could've went down because I just applied for credit and I know from these forums that it takes time to filter through.  As for my collection account, they all went into collections at the latest 2 years ago.  However, I've made payments or outright paid within the last 2 years, some within the year.  (I don't know if that changes the calculus at all).  I expect about 2 to fall off because they are old.  I have been late 2 times with my electric bill while in law school but they usually drop it off after you dispute the late payments, once paying on time after a few months.  I'm hopeful that my score can at least improve to the 620ish range in 6 months.  I know that's extremely wishful thinking, but like I said I won't have any outstanding collections on the account by next year, and I will have 2 credit cards paid on time for 6 months.  I don't know if that helps me in any way, but I'm hopeful. 

P.S.  Thanks for the advice, everyone. 

Message Edited by lawandproud on 12-13-2007 07:13 AM

[ShanetheMortgageMan]

FHA mortgages don't have a minimum required credit score, they just require that you have 3 trade lines with on time payments for 12 months, and clean credit history for 12 months.  Since your most recent collection went into collections ~2 years ago, and you plan on having them all paid off by the time you apply, your credit history should be fine as long as you have the trade line requirements.  Non-traditional credit can also qualify for those trade lines, including:

• Rental History
• Appliance rental or purchase
• Cable television bills
• Daycare expense
• Dealer financed auto loan
• Electricity bills
• Furniture rental or purchase
• Gas company bills
• Insurance premiums
• Jewelry purchases (store financing)
• Long term layaways
• Medical bills paid per payment agreement directly to the provider
• Owner financing on purchased goods
• Rental of current or previous residence
• Rent-to-own agreements
• Store financing
• Telephone Bills
• Personal Property Tax bills