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Mother and daughter to purchase together; daughter having mid 600 score and she is the primary wage earner. Mother has mid 568 score. Is it possible that mother uses her income while daughter uses her credit score to qualify? property in Florida

Looking for 100% LTV full doc, SFR and around $150,000

Guest

It is possible that the mother uses her income while the daughter uses her credit score to get both of them qualified for a home loan. But the lender will only allow for this when both of their names are on the loan document.

wablola · Posted: Thu Apr 05, 2007 7:43 am Post subject:

It is very possible for mother and daughter to purchase a home together. Since the daughter has a higher FICO then her mother, she would be considered the Primary Borrower while the mother will be the Co-Borrower. However, lenders will check the income of the daughter to see if she is considered a high risk borrower if her income is significantly lower then her mothers.

My suggestion is for the mother to check her Credit Report with a fine tooth comb and look for any errors. If there are errors, please have the mother contact those institutions to see if it can be corrected. Just by correcting those errors, may bring her FICO up higher and provide the mother and daughter a better rate.

Also, I would suggest to see if the mother and daughter can qualify for an FHA program in Florida. From looking at the FHA website, depending on the county of Florida, the lowest amount they can borrower through FHA is $200,160. Well above the amount of the purchase price of the SFR home of $150,000 that they are interested in. FHA also provides a Down Payment Assistance Program. Please look into those since it may save them significant amount of money.

Hope this information helps.

kenstampe · Posted: Thu Apr 05, 2007 8:38 am Post subject:

All loan applicants credit history will be considered. I have to disagree with Ablola in that the primary borrower would be the applicant providing the most income.

Now I absolutely AGREE with Wablola that an FHA loan may be a great solution as there are no credit score requirements on that program. However, the buyers will have to make a 3% contribution towards down-payment and/or closing costs. As Wablola mentioned, there may be grants or perhaps seller funded down-payment assistance that can be used to cover that 3% when using an FHA loan.

The other suggestion I would make is talk to a bank like Chase, Citibank Wells Fargo of Bank of America and ask them about first-time homebuyer or moderate income homebuyer programs. I know our bank has programs for 100% financing which you may qualify for that wouldn't have credit score requirements.

Good luck, I think there is a great loan program out there for you!

wablola · Posted: Thu Apr 05, 2007 9:40 am Post subject:

Guest

kenstampe · Posted: Thu Apr 05, 2007 10:14 pm Post subject:

Wablola, let me be clearer.

Guest

Thanks a lot guys.

I usually had the idea that the FICO score was an important factor for a loan but is it not that affecting an FHA loan? and if the FHA loan is a good choice for me, what financial qualifications do I require? Is a full deoc FHA loan possible and at the amount I asked for?

helping_user · Posted: Fri Apr 06, 2007 5:58 am Post subject: RE: florida home loan

yeah, even if i think i have read somewhere that the primary borrower is the one who has higher income.

As far as I have heard, the FHA loan does not have income requirements as such. And, all FHA loans are full doc loans. People with credit problems can still be eligible for FHA loans.

Thanks.

sitalotbeach · Joined: 03 Nov 2006 Posts: 48 23.63 Dollars($)

You need to work with a broker for the twist of using Mom's income and daughter's credit score. Due to the fact of many lender's to choose from, it's hard to say which one will do this.

Many lender's closed shop in the last 2 weeks that were popular of using these types of underwriting. Only a few still exist.

Is there a down payment available? 401k to borrow from?

100% is possible but scores for these now need to be above 620. If the score is below 620, creative financing will need to be looked at.

Will the seller hold a 2nd which will make up the 20% down? Or could they hold a 15% 2nd mortgage and you can come up with 5% down?

There are 'Community Programs' available through lender's that give the best rates for 'Public Service' workers, ie; nurse, nurse ast., firefighter, police officer, etc...

Guest

Any info on what are these community programs Sharlee? Are these only for the down payment or these some loan programs?

sitalotbeach · Joined: 03 Nov 2006 Posts: 48 23.63 Dollars($)

Community program is exclusively for community service workers who work for the 'community'.

Hospital, medical office, pharmacist, dentist office, police dept., fire dept worker. It covers many withing these offices.

There is community down payment assistance available from your County/Township housing authority.

What this program will do for you is receive a lower rate from the lender because you now have a down payment. I have seen clients with up to $20,000.00 from the community program. It is a 'forgivable' loan from the program after a set amount of years. Possibly 5 years. If you plan on selling the house in 6 months after purchasing you have to pay back the loan to the program and the rest of the proceeds from the sale are yours, if you sell the home for more than purchase price.

Lender's offer 100% financing for 'communtiy service providers' known as community program.

sitalotbeach · Joined: 03 Nov 2006 Posts: 48 23.63 Dollars($)

You contribute to our safety. We invest in your future.

Most traditional home loans require an extensive credit history and significant savings. But with our loans especially for those applicants who serve the community, you can meet the requirements for up to 100% financing, even without established credit. It's the ideal loan to help you overcome the high cost of home ownership.

· Less cash needed to close - Up to 100% financing is available to qualified applicants for a single-family home, with the lesser of 1% of the sales price or $500 from your own funds (5% down with 3% from your own funds for two-unit properties). Remaining downpayment (if applicable) and/or closing costs may come from flexible sources (gift from relative, grant from non-profit or local government agency, or downpayment assistance plan).

· Alternative credit histories accepted - making it easier for you to qualify for financing

· Adjustable, fixed and adjustable, or fixed rate, interest-only financing-- choose the option that best suits your needs

· Available with our combo home equity loan program- to avoid mortgage insurance

· Eligible applicants

· Full-time sworn members or employees of a police department and certain related professions1

Call today and determine how our loans just for police officers can turn your dream of buying a home into a reality.

kenstampe · Posted: Tue Apr 10, 2007 9:31 pm Post subject:

Sharlee,

There are more lenders still offering 100% financing then your post implies. The sub-prime 100% financing is what was really hit and that was specifically loans for people with low(er) credit scores say below 660 who wanted 100% financing.

Furthermore, all of your mortgage lenders who are banks like Wells Fargo, Chase, Citibank, Bank of America, etc. still offer community products that do not require the person be employed in a specific profession. Yes, those loans exist but there are others that accomplish the same goals without being specific to an occupation.

My guess is the program you are describing for Jane is one you broker to one of the banks I listed above. The banks that offer these loan programs offer them at lower rates and fees directly to consumers, Jane. If you are interested call one of the banks I mention.

good luck.

sitalotbeach · Joined: 03 Nov 2006 Posts: 48 23.63 Dollars($)

Ken,

Yes there are many programs directed towards many credit scenarios and people who work in many different fields. I was using the above as an example because many are not aware of this.

As far as rates go, yes I do 'Broker' to the largest lenders out there such as Wells Fargo, IndyMac, Bank of America and Washington Mutual. I had the pleasure of working for a few of these banks and found that as a Mortgage Broker, we can 'Shop' rates and programs for the customer instead of the customer 'Shopping' individual banks. I see this every day. Where a customer will go to several lenders 'looking' for the 'Best' rate and all the while each Bank will pull their credit. A broker will only pull credit once as long as your dealing with an experienced one.

Wholesale is best, why go 'retail' when you get the best rate wholesale? 'Wholesale' as in brokering.

Best of luck to all!

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Can mom use her income and daughter credit score to qualify?