Posted on: 01st Feb, 2010 10:02 am
Before I begin, many thanks for all the help!
My girlfriend and I are currently looking at a foreclosure that seems like a terrific investment. Unfortunately, while I was in college, I wasn't too smart with my credit card usage and there are negative accounts listed on my credit report (I've already started working on cleaning these up, but that will take 30+ days). And since college, I haven't used credit cards at all, leaving very little opportunity to raise my credit score. Currently, its around 570.
As we begin to look into 203k lenders, I can't seem to find any that will allow me on the mortgage with anything less than a 620 score. Unfortunately, my girlfriend's income isn't enough to be able to qualify for the entire loan amount (~300k - she qualified for $265k, but her $86k salary isn't enough on its own). And to make matters worse, my salary is more than hers ($110k). I wish I would have realized how important credit is while I was in college (just a few years ago).
Is anyone familiar with a lender that will originate a 203k loan given our situation?
My girlfriend and I are currently looking at a foreclosure that seems like a terrific investment. Unfortunately, while I was in college, I wasn't too smart with my credit card usage and there are negative accounts listed on my credit report (I've already started working on cleaning these up, but that will take 30+ days). And since college, I haven't used credit cards at all, leaving very little opportunity to raise my credit score. Currently, its around 570.
As we begin to look into 203k lenders, I can't seem to find any that will allow me on the mortgage with anything less than a 620 score. Unfortunately, my girlfriend's income isn't enough to be able to qualify for the entire loan amount (~300k - she qualified for $265k, but her $86k salary isn't enough on its own). And to make matters worse, my salary is more than hers ($110k). I wish I would have realized how important credit is while I was in college (just a few years ago).
Is anyone familiar with a lender that will originate a 203k loan given our situation?
You should talk to a credit consultant or an experience loan officer.
They can give you info on how to repair your credit.
There are many homes out there now that you can wait and not have have to rush into anything.
Get your own copy of your credit report at myfico and start analyzing all the negative items. Pay down any open credit cards, and try to pay Past Due accounts (these are not collection accounts)
Lenders are very strict when it comes to the FHA 203k loan, and you will need more than just down payment and low DTI. Credit is becoming a huge issue since a lot of ppl with 720+ credit scores are defaulting
They can give you info on how to repair your credit.
There are many homes out there now that you can wait and not have have to rush into anything.
Get your own copy of your credit report at myfico and start analyzing all the negative items. Pay down any open credit cards, and try to pay Past Due accounts (these are not collection accounts)
Lenders are very strict when it comes to the FHA 203k loan, and you will need more than just down payment and low DTI. Credit is becoming a huge issue since a lot of ppl with 720+ credit scores are defaulting
and banker is correct. a 203k loan is going to be treated slightly differently, as there is a huge downside for a lender. if a borrower cannot handle payments (and bad credit is an excellent predictor of that), then they're looking at taking back the property. that's the last thing a lender wants to do.
