trying to get a mortgage on a second home

Guest 0.10 Dollars($)

Hi, Last June we signed a contract on a new home to be built. We were putting a 100,000.00 down which is coming from one of my retirement accounts. When we spoke to the mortgage broker and explained our situation that we were putting our present home on the market and planned to move south where the new home is being built. That was in August and she didn't start on our paper work until Oct. a month before
the house was to be finished. We were told everything looked good even with our credit score in the mid 600's. I can't touch any of my retirement monies until I turn in my resignation, with this in mind I purshased a lot
of furniture on my credit cards and placed it in storage expecting to move on Nov. 1st. and pay off these cards. These new bills caused us to become deliquent on these cards. We were told they couldn't give a mortgage as a second home because the rules had changed and credit scores were now being accepted higher and our scores lowered. The house is still being held for us. Do we have any alternatives?

banker0679 · Posted: Sat Jan 26, 2008 6:08 pm Post subject:

Fannie Mae has changed a lot of guidelines....this maybe the reason...
It has affected every lender.

Will you be working when you move into the new home?
Have you sold your home yet?

lisascherzer · Joined: 04 Jan 2008 Posts: 746 93.70 Dollars($)

Hi Tanay2,

You should have some options with 100,000 down payment. But it does depend on how much that equates into a percentage of the purchase price of the new home. I would need to know the purchase price along with a few more questions to be more specific on your options.

chrisburns · Posted: Sun Jan 27, 2008 5:07 pm Post subject:

What are your credit scores now with the lates?

I think you should have several options for you 2nd home purchase.

0.10 Dollars($)

Sounds as if the new RESIDENCE is not a second home. Why not go with a bridge loan? This would solve everything EXCEPT your "mid 600s" FICO. Can you close quickly on a bridge and new home? If so, speak with your broker on a "window delivery", i.e. one during February to avoid FICO hits, and see what can be workded out. You'll pay a price on the spread from MBS pricing but better than waiting and taking FICO hit.

Samantha

Yes guest, a bridge loan can be a good financing option to pay for a part of the construction costs till Tanay can get a mortgage on his home.

But if he is looking for a mortgage to build the second home, then a construction loan could be fine. However, he needs to convert it later into a permanent mortgage or else pay off the loan right after the construction is over.

If you have further queries, please don't hesitate to ask.

May god bless you.

Samantha

evolovik26 · Posted: Tue Jan 29, 2008 8:38 am Post subject:

Most likely your broker was expecting to get you on a stated loan or a no income verification loan. Now with lates and lower scores it is not possible and your real income does not support the debt to income ratio.

gmakerley · Posted: Wed Jan 30, 2008 9:40 am Post subject:

once again, we don't know enough of what your original deal consisted to ensure that the advice we can provide will be beneficial.

nevertheless, it would seem that you could still obtain second home financing, even with reduced credit scores. of course, such financing will probably be more expensive than you had originally planned, but that is a function of the reduced credit scores.

mid-600 scores are not bad; simply not good enough to get the best of rates these days. do some more investigating and i feel certain you will find a lender who can assist you.

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