Home Buying in 62401>Question Details

Mathew G, Home Buyer in Effingham, IL

Can I get approved for a USDA direct loan with a 600 credit score?

Asked by Mathew G, Effingham, IL Thu Jan 10, 2013

Monday my fiancee and I put in an application for a usda loan for a 70k house. We met the eligibility guidelines for income. Everything seems good but I'm worried about my 600credit score, and my fiancee's 650. I make more than she does and have had my job for 2 years compared to her 10 months. The agent said we have a chance of it working out since I have paid off all debts except our 2 open accounts that have never had a late or missed payment and solid record with our current land lord of a year. Has anyone had experience with low score approval on a usda loan? He said that since our rent was 500, and the mortgage payment would only be 440, we were looking at a good affordable price range for us. Lastly how fast/slow is usda on saying yay or nay? We applied Monday Tuesday we had credit checks ran and Wednesday they were doing employment verifications. Is this good news it just ordinary? Thanks in advance. Mat

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Answers

6
You can get approved with a 600 for FHA, I have a great place I send my clients with scores under a 640 to get approved. If any company can get you approved its the The Lenders Network

Good Luck!
3 votes Thank Flag Link Tue Jul 2, 2013
I want to say there are 2 options for you conventional which requires a 620 score and 3% down, or FHA with scores down to 580 and 3.5% down. I'm not a Lender but go to The Lenders Network's site they will get you with a Real Estate Agent in Newark and find you a Lender that can approve you. Thanks for your reply have a great weekend!
Flag Sun Sep 29, 2013
hey jessica my wife has a 624 and we are trying to get a house back in her home state . and thats in newark new york
Flag Tue Sep 24, 2013
The lenders we work with are generally requiring a 640 score for USDA loans. You may find some lenders doing it for lower than that but may be a bit tricky.
0 votes Thank Flag Link Fri Jan 11, 2013
USDA Direct are generally 30 year fixed rate loans. In some cases, depending on individual situations, rates may be higher than current bank rates based on credit score. The home you buy must meet USDA requirements. Once approved and home is purchased your mortgage will be sold off to secondary market. In some cases, individual situations apply, If you qualify for 50K the loan might allow a 2% above to include closing cost, inspections ect. Once approved the USDA rep you spoke with will cover all of that.
Web Reference: http://www.usda.org
0 votes Thank Flag Link Fri Jan 11, 2013
I'm not going through a bank at this point though. This is usda direct. Their model score is 640 but its not a minimum per se. Just wondering about this type of home loan in general.
0 votes Thank Flag Link Fri Jan 11, 2013
Thank you for such a great question! Usually the minimum for USDA is 620. Some local banks and lenders can do a mortgage on a lower score, but need a larger down payment. I recommend contacting some local lenders in your area and asking them if they can help you. Also, you may consider hiring a credit service to help get your score higher.
0 votes Thank Flag Link Fri Jan 11, 2013
It sounds like good news. Credit scores generally have to be 640, and yours would probably be combined. Every bank and Mortgage company is different and has different guidelines as to their lending requirements. If there wasn't a good chance odds are you would have known in 24 hours. So much goes into the factors the bank looks at stay positive and if you get a no from one contact another. Hope this helps ...
0 votes Thank Flag Link Thu Jan 10, 2013
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