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usda advice

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knvern
New Member

usda advice

Hey everybody!
Just a little background story and then a couple questions

I met my wife in '09 she was 18, I was 20. Got pregnant in 2010 and had our first child. she is currently pregnant now, expected due date of Aug 2014.

We have rented the same 1 bedroom apartment for 4 years now. She is a stay at home mother, meaning no income. I make roughly 30-35k a year. We have no car payments because we buy our cars cash.

She has a credit score of 740, I have 595, but just paid off last and only thing in collections so that should go up soon.

We have been using her credit since we've been together because she hadnone, to try to build it up. Never missed payments. And always paid things off early, if not right away. All of this while supporting 3 people off of just my income.

We jjust put in an application for usda rural development, so I'm wondering if wwe even have a chance? Is thereanything I should be concerned with?

Aside from the thing in collections just being paid off, there has been no activity on my credit report for 5+ years, after making some dumb mistakes and trying to stay away from credit to work things out. 1 derogatory remark, over 5 yyears ago.

Any insight and assurance would be greatly appreciated. I'm 24 now, and just want to own a home and provide for my son and new baby. We are extremely crammed where we live now but don't Want to rent another place

Thanks guys!

Message 1 of 6
5 REPLIES 5
SSTO
Valued Member

Re: usda advice

For the USDA Direct Loan, I would think that you should get your score up to at least a 620 (preferably 640).  Since she isn't working, the loan will be based on your income, so I don't think her high score will do you much good...but I may be wrong.  Based on your score, I don't think you'd pre-qualify - they look for a minimum score of 640 - though I squeezed in (going through the process now with a 638 score).  What is the reason why yours is so low? 

Message 2 of 6
knvern
New Member

Re: usda advice

Mine is low because when I was 18 I was laid off just after buying a car, so I got a credit card to try to keep myself afloat while looking for another job. My dad then kicked me out of the house for having a couple of friends over when he didn't know, so I was.living out of my car for months. Well needless to say, I ran the card up within a couple months and couldn't pay, so I had no choice. took back the car that I was living out of, only to be homeless. Staying a night or two out of a friends house maybe, but homeless for the most part. Then I finally got a job, and was hardly making ends meet as it was. That's when I met my wife and got pregnant. Since then I'm making more money, but while trying to support a family of 3 while paying ALL the bills, I hadn't had a chance to address credit issues. I was more concerned with keeping our cars running and keeping food in the house, along with keeping up on current obligations and open CC accounts.
Its been 5+ years since I've had any negative activity on my credit report, so is there any way they'd look past my past, and see that it was a ddark time for me, and hasn't happened since?

We've been using my wife's credit, and hers is good. all activity on her credit is essentially me, making the payments and providing the income.

Since paying off the collection, my credit will update March 15th with the info, do you think it will put it around 640 or no?

We put in our application yesterday, so I guess well see but I would just like a little assurance. I know I should take my credit up, and that's obviously what I'm trying to do.

We also have no other debt. No car payments, one credit card - with 0 balance, and always pay out phones and insurance on time. Plus I have lots of resources showing I'm steady and on time with payments. Landlord, insurance, phones, etc.

I'm working on bringing my credit up, but with 3 people in one bedroom, and another on the way, my father and husband instincts kick in, and I feel the need to make a large change to support my family.

Message 3 of 6
SSTO
Valued Member

Re: usda advice

Yikes...you've had quite a bit of hard luck, so hopefully things can/will get better.  They do look at alternative credit (such as utility bills, etc.).  Have you called to check and see if funding is currently available?   What I would do if I were you... I'd call and check to see if funding is available in your state, but find out if you would be considered Very Low Income, or Low Income for the Direct Loan as I believe that a certain percentages of the loans have to be set aside for Very Low Income - so even if funds are left, if you are Low Income and they only have Very Low Income available, you might not be able to be funded.  Once I found out whether or not there are funds, I would make an appointment to go in and meet with them regarding your circumstance, so that you not disqualified by them soley based on them looking at your credit score.  I would be pro-active and get your w-2 forms, pay stubs, and even copies of rent checks paid and bring them all with you...but like I said, you might want to check on if funds are available first.

Message 4 of 6
knvern
New Member

Re: usda advice

funds are available, my mother in law works for the state and knows someone in the ssystem. We sent in tons of papers with our application, because my mother in law knows the system and told us exactly what to send in. W2's, paystubs, bank account statements, bills, etc. She faxed it straight to their office.
We even included all the information regarding the collections, and showed its being paid off.

Should I call to explain my situation then or just wait to hear back?

I don't want to be the reason us 4 have to sleep in the same room together, and its eating me alive. I just want to give my family what they deserve, and I personally know I'm not going to miss any payments, but if only usda could know that...

Message 5 of 6
SSTO
Valued Member

Re: usda advice

That's great that funding is available.   With regards to waiting or calling them... I tend to like to be pro-active and would call them and see what they say, or if you can make an appointment to go in there and speak with them.  

Message 6 of 6
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