Credit Score in Los Angeles>Question Details

Yesenia Hern…, Renter in 90280

My credit score is currently "Weak". Should my husband and I apply for a loan now or wait for my credit score to go up?

Asked by Yesenia Hernandez, 90280 Mon Jul 19, 2010

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Christina Solorzano’s answer
It's not so much if you should, its if a lender will approve your weak score. Anything under a 620 isn't likely to get approved with more than 20% down. If you would like help understanding how to raise your credit scores and get mortgage ready give me a call.

Have a great day;

Christina Solorzano;
CEO & SR Credit & Mortgage Consultant of
Everlasting Credit Repair
Ex-Mortgage Broker of more than 10 years
http://www.everlastingcredit.com
0 votes Thank Flag Link Wed May 15, 2013
Apply now! There are still lenders that can help you with bad credit, I have had clients with a 580 credit score get approved for FHA loans. Check out The Lenders Network they can refer you to a couple of bad credit lenders.
1 vote Thank Flag Link Sun Sep 29, 2013
I would suggest starting the process by speaking with lender that works for a reputable institution before you start disqualifying yourself. Thanks to FHA , buyers can qualify with a credit score as low as 620 & still get a VERY competitive rate. Today I ran two scenarios for a buyer, a 20% down conventional loan where the rate was 4.875% (with no points charged) & a FHA 10% down loan where the rate was 4.75% (with no points charged). The only drawback with FHA is the private mortgage insurance that you have to pay on a monthly basis, which can cost anywhere from $75 - $225 a month (depending on the loan amount).

Worst case scenario, if your score does not meet minimum lending requirements, the lender should be able to advise & structure a plan to improve your score.
0 votes Thank Flag Link Tue Jul 20, 2010
Yesenia,
If you and your husband want to buy a home then you should talk to an experienced, competent lender that has a multitude of lending options. A mortgage banker is your best option to provide the service you seek. A mortgage banker has access to many investors that will best suit your needs, they will check your credit once and they will have access to partners that can consult with you about credit improvement if needed. I have many couples that have been able to raise their credit scores to the level where they can get an FHA loan. An FHA loan will allow you to get a lower interest rate for less cost than a Conventional loan and the FHA loan allows you to have $5000 of unpaid medical bills that do not need to be paid off. If you have some items on your credit that are reporting incorrectly then they can also be addressed.
One last thing, if you decide to talk to a mortgage banker; do not let them pull your credit until you talk to them and get a good feeling about what happens next and your potential for getting a loan. This should take about 10 minutes on the phone but if you have one check your credit, your credit score will not be impacted for 14 days if you should decide to have another lender check your credit because you made a bad choice. So mark you calendar the day the credit is checked and if your credit score is low or just barely qualifying do not get it checked again after those 14 days. Good luck, and if you need some help I am happy to talk for 10 minutes.

Matt Puzz
Loan Originator
Citizens Choice Mortgage
602-410-9333
0 votes Thank Flag Link Tue Jul 20, 2010
Do I know you? That's an unusual name. Anyway, the answer I'd go with is "talk to a lender." The only possible negative is that they'll pull your credit (a slight ding in itself), and taking the time to do the paperwork. On the plus side, you get a more concrete idea of where you stand and the lender should share ways to improve the score.
0 votes Thank Flag Link Mon Jul 19, 2010
Yesenia,

Its possible to get FHA financing even with a credit score under 640. If you're going the Conventional route there are many loan level adjustments which would yield a higher interest rate as opposed to FHA financing. However, the rate will be higher if you're credit challenged going FHA since fewer lenders are willing to take on the layered risk.

Its absolutely critical that the past twelve months needs to show a clean record without any lates of any kind on any monthly debt obligation. I would recommend having your credit report reviewed by a mortgage professional. Also, if you have multiple collections, judgments etc. it may be ideal to work with a credit consultant they are typically referred by a loan agent so that you can get back on track.

Regards,
Shawn
0 votes Thank Flag Link Mon Jul 19, 2010
No, not necessarily should you wait. A good loan officer will help you get your credit up to where it needs to and there is a way the loan officer can do a rapid re-score to get you where you need to to be qualified. Call me and I have a great loan officer I work with regularly and he is very experienced. Do you know what areas you would like to look at homes? If you email me I can send you a list of available properties, heatherprealtor@gmail.com 424-625-1037 Have a great day!
0 votes Thank Flag Link Mon Jul 19, 2010
As you can see, there are several factors to consider. Your best bet is to go ahead and talk to a lender, who can take a closer look at your specific situation and be able to give you advice. They can also advise you how to go about improving your credit score if needed. This can sometimes be done in a relatively short time. If you need a referral for a lender, please feel free to contact me.

Richard Schulman
Keller Williams Realty
#1 Agent KW Westside Realty
(310) 482-0173
schulmanrd@yahoo.com
0 votes Thank Flag Link Mon Jul 19, 2010
john Says;

"If you are at or above 640, you should be good. Otherwise, I'd recommend waiting if you can help it."

This is incorrect advice unless you are in an FHA loan currently or planning to purchase with an FHA loan. An FHA loan won't penalize you for the 640 whereas a conventional loan will. To get the same rate for a conventional loan that a person with a 740 credit score will get, you would have to pay 2.5 points up front. Look at it this way, if you have a $300,000 loan, you have to pay an additional $7,500 in closing costs just to get the going rate that a person with a 740 credit score would get for no points.

If you are looking to purchase with an FHA loan or you are refinancing an FHA loan, then you may be ok. If you are trying to refinance a conventional loan or plan on purchasing with a conventional loan, it will cost you dearly because of your score.

Gregorio Denny
Tripoint Mortgage Group, inc
800-335-6897
Web Reference: http://WeFixRates.Com
0 votes Thank Flag Link Mon Jul 19, 2010
If you are at or above 640, you should be good. Otherwise, I'd recommend waiting if you can help it.

John J Mondello Jr, Realtor
Keller Williams
(225) 329-8119
"I find the house, you make it home."
0 votes Thank Flag Link Mon Jul 19, 2010
Hi Yesenia,

It depends on what you mean by weak. My advice is to talk to friends, family and co-workers who have recently purchased a home and interview several loan officers until you find one that you are comfortable with. Then you want them to start a file for you and you should be honest with them about everything. That way they will be able to take you to the next step.

Your credit may be good enough to get you in the door. However, there are many other factors taken into consideration not only on whether or not you get the loan, but also the type of loan and the interest rate that you will pay.

A good lender can also advise you on how to build that credit score in a relatively short period of time.

Hope this helps.
Linda
Web Reference: http://www.lindacefalu.com
0 votes Thank Flag Link Mon Jul 19, 2010
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