Financing in USA>Question Details

Need2know, Renter in Atlanta, GA

Should I trust my LO if she tells me my credit score will be where it needs to be by the time the house is finish being built.?

Asked by Need2know, Atlanta, GA Mon Nov 19, 2012

We are 40 points off from being pre approve and she will submit the application in 60-90 days once we are in the 640. She suggested we get a secured credit card, spend 1% of the credit line and pay minimum monthly payment. She also suggested we go ahead and start the contract with the builder and since it will take 4-6 months to build, she believes we'll able to close by then. I am afraid that even though she said we can get pre approve for a certain amount based on our income, the underwriter may decline.

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Your fears are not unfounded. In order for her to issue a valid pre approval letter to your builder, it has to be based on your CURRENT credit status, not on what she thinks it will be in a few months. Work on your credit FIRST, get your scores where they need to be, and you will eliminate any unwanted surprises at the end. Your mortgage approval is not based on score only. You must also have a certain number of you ESTABLISHED trade lines as well. As a former mortgage banker of 16 years, there are too many variables to list for your credit requirements because they also vary depending on which particular program you will be utilizing for your financing needs. I would strongly suggest that you use a different lender, one that can be factual with you, not suggestive. Or, get a second or even third opinion on the matter......until you are comfortable with the person guiding and assisting you with your purchase.
1 vote Thank Flag Link Mon Nov 19, 2012
Boy you better be careful!!!! I have written many articles about credit, and I can tell you this. If you get a secured card NOW, it will be too new to rate in order to effect your scores in a positive way within that short of period of time. It will take at least 6 months. There are better more efficient ways of bringing your score up. Click on my Profile and read some of the blogs regarding credit BEFORE you do anything.

Best of Luck!
Web Reference: http://www.AFN-loans.com
0 votes Thank Flag Link Mon Feb 18, 2013
No,no,no, 640 is just good enough to get approved for a high interest loan. Get your score up to 680 at least. Do not sign anything until you are there. It is your Name on the paper, not hers.
0 votes Thank Flag Link Mon Feb 4, 2013
I would not do this. Your lender has no control over your credit score. If you sign a builder contract, invest money into getting the house started, and then can't follow through with the purchase... You will be out the money, and the builder will be stuck with the house. I highly suggest you get another lenders opinion, and wait until you actually qualify before signing any contracts.
0 votes Thank Flag Link Tue Nov 20, 2012
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