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Nicole Mcdon…, Home Buyer in Iowa

Is there anyone who will give a mortgage to a credit score under 620?

Asked by Nicole Mcdonald, Iowa Tue May 8, 2012

We are currently renting and our lease is almost up and we'd like to buy a home. We are 2 years out from a bankruptcy with no late payments since. Husband's credit score is right around 600 depending on which bureau is pulled. We have 20% to put down on a loan and a co-signer if we need it but we've tried 3 local banks and been declined due to the bankruptcy. Is there anyone who will give a mortgage to a credit score under 620? My husband makes $85,000 a year.

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3
Randall Yates’ answer
The Lenders I'm partnered with offer FHA loans with a 580 score, Conventional require a 620 and 3% down..I can refer you to an agent to help you find a home and a Lender or two that can get you pre approved.

Good Luck!
1 vote Thank Flag Link Sat Sep 28, 2013
We see many credit reports with low credit scores (anything less than 620), and often many scores in the 500's. This is BAD credit. If you are one of the folks affected by this terrible economy, you have a low credit score and you have a dream of buying a home, here's some simple advice for you.


It is unlikely you could be approved for mortgage financing with that credit score at this time.

Beware of any mortgage professionals promising you an approval with such a low score. Wait on buying a home. I recommend you take the time to resolve your credit issues.

First, settle any outstanding debt. If you owe money on collection accounts, charge-offs and/or judgments, make payment arrangements and get these accounts paid promptly.

Next, begin rebuilding your credit. If you have current accounts with good payment histories, or even some previous late-payment-blemishes, make sure you continue to pay those accounts on time. If you do not have any existing credit accounts then you'll need to establish several in order to create a viable credit history.

I have found that CONSUMER ACTION is an excellent resource for objective advice on all things credit related. You'll find free and sincere advice on everything from settling collection accounts to rebuilding credit to building credit from scratch on their website http://www.consumer-action.org/.


Beware of anyone offering to "repair" your credit! The Federal Trade Commission issued a stern warning last year that such offers are scams. Find more from the FTC HERE. http://www.ftc.gov/bcp/edu/microsites/moneymatters/dealing-w…


The best way to buy a home is to have a decent credit history combined with sufficient Income and Assets for a home purchase.

The best way to have a decent credit history is to settle negative outstanding obligations and pay all your bills on time for at least two years.


Trevor Curran
NMLS #40140
0 votes Thank Flag Link Tue May 15, 2012
Nicole,

Sometimes credit unions or mortgage lenders who service their loans in house can be more flexible. If you give me a call or text I can put you in touch with three excellent local lenders who may be able to help you.

If they aren't able to make anything work, you may be able to find a short term lease. Good lenders will often work with you to help improve your credit score even further and will give you an idea of how long it will take to improve your credit to a point they are able to loan to you.

If you are looking for homes in or around Bettendorf, I can help you with that too.

Charlotte
Flag Thu Feb 13, 2014
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