You have a stable job. You apparently have some cash to put down. You're saying that your credit score is clean except for "the only credit ding" of a single past-due judgment for child support. And yet your credit score is only 540? That doesn't make sense. Either your credit score is a lot higher or else there's a lot of other negative information on your credit score.
Check with a good loan officer or mortgage broker. Find out: (1) what your real credit scores are, (2) what the negatives are on your credit report, and (3) what steps you should take to strengthen your score.
Hope that helps.
My first question would be how do you know your credit score is 540? I ask this because so many people confuse the scores given to them by some means other than actually having a lender pull a MORTGAGE credit report. The results can be vastly different, and it does not sound like you have talked to a lender yet. So, I agree with the real estate agents below, contact a lender and ask them to pull the credit report which will actually be used to qualify you for a mortgage.
I will take this opportunity to make a point, again. What you are going to find is most experienced lenders will not want to work with you due to the time consumed in getting your credit fixed AND then actually getting you approved and through the buying/closing process, when the amount of commission which will be earned on your loan is limited by the Dodd-Frank Act and The Federal Reserve. The Dodd-Frank Bill, while trying to protect consumers, actually did people such as you great harm. It forces all lenders to earn a set percentage on any size loan we do--so I would make less than $600 on you, while I could be spending my time on a $300,000 loan and make about $4,000. Which one do you think experienced lenders are going to gravitate to when the real estate market picks up again?!?
I encourage you realtors to look at this issue now, and use the power of the National Association of Realtors to fix it before you actually can find no lenders willing to help your small loan clients.
Good luck, Michael.
Another possibility is ask your agent if they know any "hard money lenders". These are private individuals who loan money. The interest rates may be a bit higher than the banks rates but at the small amount you are looking to borrow - the payment would still be nominal.
Rox Real Estate
The home will be used for a rental but its MY first home purchased. Currently my wife bought our home in her name. Thanks
Your situation deserves attention to find a way to accomplish your goal of owning a home. Lenders vary and not all will be a good fit for your situation. Lets locate one that understands what you have done well and not so well and position you to buy a home.
San Tan Valley is doing really well now, foreclosures have really dropped off in numbers and prices are going up already. Great place to live!