Sheryl Arndt, Real Estate Broker â€“ Sr. Loan Officer CA only
REO & Short Sale Specialist
20+ Years Experience
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.
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.
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.
*If you thought my answer was helpful, please give me a â€œThumbs Upâ€ or â€œBest Answer.â€ Thanks!
I think it is definitely worth taking the time to talk to a good lender to see if you qualify. FHA does tend to be more lenient than others so the chances are you would qualify.
Feel free to call me for a good lender referral!
Carolyn Zeigler, CRS
If you're not working with a lender yet, any one of us realtors in the area can recommend lenders you can speak with -- whether you prefer working with a direct lender (bank) or a mortgage broker.
All you have to do is ask.
Your chances are pretty good. Much of it depends less on your three digit credit score then it does exactly what is in your credit file. I've seen people with very high scores but with foreclosure 2 years ago. They cant qualify. I've seen people with low scores qualify.
Contact this fella. He is local in Pleasant Hill and he will give you the straight scoop on it all. He is hands down the best lender I have ever found. He just closed a VA buyer that no other lender could close. He is honest, hard working and has great rates and fees. Please make sure you told him that Neil Case sent you and he'll take extra good care of you. Here is his name
Mike Trejo at Bridgepoint Funding. Mobile phone 510-912-7102