Are Sup-Prime mortgages still available?

fozman68 · Joined: 14 Nov 2007 Posts: 24 10.49 Dollars($)

Since I can\'t get a FHA, are there still sub-prime mortgages available?
I\'ve worked on my cr.report. I raised it from 495 to 648 (middle scores), in 11 months. I also plan on putting 20% down. What are my best options? I really don\'t want to rent another year.
thanks again.

livinginnky · Posted: Wed Nov 14, 2007 12:22 pm Post subject:

Welcome to the forums!

Why can't you get FHA?

How did you raise the score so rapidly?

And yes there still are subprime loans. But I have to warn you even with 20% down the rates can be ugly. Low subprime is still 9% rates and up.

Guest 0.10 Dollars($)

thanks for the welcome. 1st, can't get a FHA because of Chapter 13 dismissed 10/06. Already got that info, as to having to wait 2 years.
2nd, raised my score, by getting a car loan, Last November, and a secured credit card, and never missed a payment. Other than that, I have satisfied 4 other accounts.
3rd, If everything I heard and read is correct, then my options are subprime, or rent. And I don't want to Rent. I'd rather pay their interest, and refinance.
Are there any other options?

Guest 0.10 Dollars($)

There are some sub-primes out there. I was approved with a low credit score. I have no knowledge regarding how a bankruptcy would affect that. The company was Allied Home Mortgage Capital Corporation. The rate was a bit high. I decided to wait though, hoping for a better rate next year when my score improves.

jenkin7 · Joined: 04 Jun 2007 Posts: 939 140.77 Dollars($)

Hello Fozman,

I have already replied to your query at http://www.mortgagefit.com/fhaloan/chapter13-dismissal.html
Have a look at it.

michelle · Posted: Thu Nov 15, 2007 4:13 am Post subject:

Welcome to the forum.

Thank you for providing the information about your credit. It does appear that you are on the right track to re-establishing your credit after the BK.

I have to agree with Eric that there are still subprime programs out there, but the rates will be relatively high. If you are willing and able to comfortably pay the higher rate you could use a subprime mortgage at this time and attempt to refinance in a few years.

Another option for you to consider would be a lease/purchase. You would deposit your down payment with the seller and make monthly rental payments (usually higher than a normal rental payment). At the end of the negotiated term with the owner, you would then obtain your mortgage. This might allow you to get into the house you want now without having to move again when it is easier for you to obtain a loan.

I would recommend seeking the assistance of a realtor to help you find a property. Also be sure to have an attorney involved so they can be sure all documents you sign are legal and protect you from losing your down payment.

evolovik26 · Posted: Thu Nov 15, 2007 6:49 am Post subject:

Another thing you can try is getting a contract for deed ( there are alot of ppl looking to sell out there) You might be able to arrange for better then 9% rate and get a good deal. ( make sure you got an attorney representing you to protect your interests. Then after a year ontime payments (make sure you keep all cancelled checks) you can refi into FHA or a conventional loan.
Othervise you can go subprime rout but expect 9+ rates and you'll likely need to go full documentation route to get under 10% rate.

livinginnky · Posted: Thu Nov 15, 2007 10:47 am Post subject:

I agree that a lease/option or land contract could be a great alternative. You could get a lot of landlords to agree if you pay them...
1. Money down
2. A premium rent (with a portion that goes towards your future down payment)

That way you get to live in the home you will purchase and save extra money towards your down payment. You will save closing costs as you won't pay twice.

If you definately want to purchase, as you have stated, the best place to start would be a mortgage broker. Subprime loans can be tricky and with a good broker you can switch lenders if one does not work out. You can contact one of our community lenders here http://www.mortgagefit.com/quote/

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