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HomeCredit ForumCredit repair

Buying a house with bad credit

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strifex316



Joined: 04 May 2008
strifex316's page
Posts: 1



43 Magic Points
Subject: Buying a house with bad credit
 
 Posted on Sun May 04, 2008 9:14 pm  
I would like to buy a house later this year but I have a credit score of 545 and only about 5-6000 to put down. I have about 6k in debt and 2 small collections. Is it possible for me to buy a house by November? Thanks!
 
fireyone



Joined: 26 Feb 2008
fireyone's page
Posts: 642



3017 Magic Points
 
 Posted on Mon May 05, 2008 10:48 pm  
Yes I believe it is possible. try first to pay off those two small collections. Showing you paid them will look good on you along with having a down payment. Paying these debts will also give your score a little bump up. Good Luck.
 
sdchargers_63

sdchargers_63

Joined: 13 Aug 2007
sdchargers_63's page
Posts: 661



755 Magic Points
Subject: house
 
 Posted on Tue May 06, 2008 11:37 am  
Yeah..i would say you probably could. It's usually easier to finance something, that you have collateral for ( collateral would be your house). have you talked to different banks/finance institutions about % rates?
 
george

george

Joined: 06 Jul 2006
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Posts: 75



2859 Magic Points
 
 Posted on Tue May 06, 2008 11:46 am  
I too think that it would not be much of a problem. As you are purchasing a house, it will itself serve as a guarantor.
_________________
George Miranda

Money does not buy happiness. Happiness is found in being content with who you are and what you have.
 
Swoosh
Guest
 
 Posted on Thu May 08, 2008 6:44 pm  
Just keep in mind that the higher you can get your score before then (over 600 if at all possible) is REALLY going to help you. Right now, everyone is saying yes, you can get a house, but with the foreclosure mess right now, mortgage lenders are cracking down on those with less than perfect credit, and you will pay a premium (9+ plus interest) with a score like that. Don't mean to discourage you, but just something to keep in mind.
 
Justin

Justin

Joined: 17 Jul 2006
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Posts: 149



4739 Magic Points
 
 Posted on Fri May 09, 2008 8:17 am  
I think that Swoosh is correct. You should first pay off your existing debt and then go for another one. This will also help you in improving your credit score.
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Best Wishes
Justin
 
Guest







 
 Posted on Sat May 10, 2008 8:00 pm  
Thanks for the advice everyone! I haven't spoken with a lender yet but that will be my next step after I pay off my collections. Does anyone know if going through consumer credit counseling ( the non-profit kind, not the repair services) makes any difference to lenders?
 
Morningstar

Morningstar

Joined: 17 Apr 2007
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Posts: 598



10846 Magic Points
 
 Posted on Sun May 11, 2008 4:19 am  
No new credit will be extended to you while you are in the plan. However, when you complete the program, your score should rise.
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I don't dream since I quit sleeping
 
george

george

Joined: 06 Jul 2006
george's page
Posts: 75



2859 Magic Points
 
 Posted on Mon May 12, 2008 10:40 am  
Hi guest

Morningstar is correct. Going for a debt management plan or a credit counseling service does not affect your credit report. The credit score rises only if you make a consistent debt repayment of the entire debt amount.
_________________
George Miranda

Money does not buy happiness. Happiness is found in being content with who you are and what you have.
 
Katsarov



Joined: 24 Feb 2008
Katsarov's page
Posts: 15



811 Magic Points
 
 Posted on Thu May 15, 2008 5:53 pm  
Hi, You
You need at least 580 mid scores and you are qualif. for a FHA loan on 5.5 interest and .5 % insurance with only 3% down. Now, the scores from MyFico are the closest to the lenders calculators scores. For sure dont purchase your scores from trans union site or their providers cuz they always show higher and you will be badly surprised apling for a loan. If your coll. are in the last one year and you paid them off it will increase your fico with at least 30 scores so it will put you really close to what you need. make sure that before you pay them you have in written from the CAs, that they will remove the coll. from your report. After that go on fico simulator to see how much you need to pay towards your credit cards to raise your scores with another 5 to 10 more. And.....enjoy your new home. Remember, no lender will give you less than killing rates under 580 fico
 
Katsarov



Joined: 24 Feb 2008
Katsarov's page
Posts: 15



811 Magic Points
 
 Posted on Thu May 15, 2008 5:57 pm  
Hi, You
You need at least 580 mid scores and you are qualif. for a FHA loan on 5.5 interest and .5 % insurance with only 3% down. Now, the scores from MyFico are the closest to the lenders calculators scores. For sure dont purchase your scores from trans union site or their providers cuz they always show higher and you will be badly surprised apling for a loan. If your coll. are in the last one year and you paid them off it will increase your fico with at least 30 scores so it will put you really close to what you need. make sure that before you pay them you have in written from the CAs, that they will remove the coll. from your report. After that go on fico simulator to see how much you need to pay towards your credit cards to raise your scores with another 5 to 10 more. And.....enjoy your new home. Remember, no lender will give you less than killing rates under 580 fico
 
anthony

anthony

Joined: 31 Jul 2006
anthony's page
Posts: 254



6830 Magic Points
 
 Posted on Fri May 16, 2008 5:05 am  
Hi strifex316

I think you can try the way as Katsarov suggested. It is really a good suggestion and I hope will help you to increase your score which will enable you to get a loan from FHA to purchase your house.
_________________
Anthony..

A positive attitude is not achieved by turning a blind eye to the negative, but rather by responding to every situation in the most positive way possible.
 
CMBV22

CMBV22

Joined: 08 May 2008
CMBV22's page
Posts: 271



1751 Magic Points
 
 Posted on Sat May 17, 2008 10:21 am  
Another thing that you need to remember is to beware of your debt/ income ratio. If a bank sees that you will have more then 30 ir 40% of your income consumed by your new and current debt they will also give you less favorable terms on a loan. So be carful about taking out any debt consolidation loans.
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