Home Buying in Dallas>Question Details

Tasha, Home Buyer in Dallas, TX

I have horrible credit but a large income. My spouse has fair credit with low income? if we wanted to buy a house could we get it in his name only?

Asked by Tasha, Dallas, TX Fri Jan 7, 2011

My husband and I are trying to buy a house, unfortunately my credit is very bad. He has fair credit but recently started working as a barber. Is there any way we can combine my income with his credit to finance a home since we are married? I don't know how this works. Could any of you provide me some resources?

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18
Tasha, I agree with Don, Debbie, and a number of others who have suggested that now is not the best time for you to buy a home. If you have a large income, as you say, you should be able to clean up your credit. If you are still living paycheck to paycheck, even with this income, then there may be nothing for you to do. However, maybe that is because you are over-spending on things that really shouldn't be priorities. You have not told us how horrible your credit is, or why it is horrible. Is it because of late payments, charge-offs, collections or judgements? Work on cleaning up your credit. Make sure you pay every bill as soon as it comes, that is even better for you than paying by the due date. If you have balances over your limit, pay them down to below the limit. Not only will this save you money, it will boost your scores. Work on any collections or charge-offs one by one to make sure you get them satisfied. DO NOT agree to settle for less. That will stay on your credit report for 7 years as paid for less than agreed, and will hurt you.
Once you get things settled, get evidence of a zero balance, and send it to each of the 3 credit bureaus. Include your name and social security number in your cover letter. If you can get any of the creditors to give you a letter stating that the collection or whatever was filed in error if you pay in full, that would be great. Send that letter to the credit bureaus as well, and having the item removed will be better than showing it as paid.
Good luck, and within time you can buy that house you want, and feel comfortable knowing that you will not lose it because you can't pay for it.
1 vote Thank Flag Link Sat Jan 8, 2011
It's important for you to know that the old days of ignoring the spouse's credit score and attributing spousal income to "other household income" are gone. The lending rules are extremely tight right now. If your scores are truly "horrible", then Lynn's answer is actually pretty close to the mark, although difficult to read.

The question for you is what is "horrible"? These days most lenders have pushed required credit scores and other credit report items up very high, beyond the reach of many people. But you can still find lenders who are willing to go with scores as low as 580. (In the 'good ole days' this number was 510.) Most lenders want 620 or higher, and this means of the 3 scores, not the lowest or the highest, but the middle score.

Some people have criticized Don's comments to you, but there is a point in all that. Most people get in trouble for not budgeting (trying to plan on what they spend money on limited by their income). Following a budget takes a certain amount of self-discipline.

Lenders love people who don't miss payments and don't have creditors chasing them, but their memories are typically only two years long. If you can get all your bills paid on time (doesn't mean you have to pay them off - just pay at least what they ask), then in a couple of years your credit score will be well above the qualifying levels. Can it be done in 2-3 months? Maybe, depending on the types of derogatories on your credit report.

Don't be disheartened. Talk to a loan officer and see what can be done and how long it will take. We can't know because we haven't see your report, and we're just guessing.
Web Reference: http://www.SumnerRealty.com
1 vote Thank Flag Link Sat Jan 8, 2011
The best thing to do?

Don't buy.

I'm pretty sure some "great loan officer" out there could find the money for you. But they wouldn't be doing you any favors. Just figuring out another way to make money at your expense,

I don't blame you for asking the question. But I think you deserve better answers than some have given you.

Look: Your "horrible" and "very bad" credit is a symptom of a problem, not the problem itself. It says that in the past you didn't prudently management your finances. Maybe that's changed. If so, great. But prove to yourselves (as well as others) that you do know how to manage your money. Work on it. Your credit score will rise. But it may take awhile.

I said your bad credit is a symptom, not the problem. Here's an analogy: Suppose you don't pay your electric bills, and the utility cuts off your electricity. In the evening, it gets dark outside . . . and inside with no lights. You light candles and tell your husband that the problem is that the lights aren't working. The darkness (and inoperable lights) are just a symptom. The real problem is that the bill wasn't paid and your electricity was cut off. To solve the problem, you can't just light candles. You have to pay the bill.

Same with your situation. The poor credit is just the symptom--the outcome--of the real problem. You have to address the real problem. Some clever loan officer isn't the solution.

Good luck.
1 vote Thank Flag Link Fri Jan 7, 2011
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
Contact
May 2013, First step is to be sure you have the correct take on your credit. Have an experienced ethical loan officer who works for a lender that offers all of the loan types look over your credit. Loan officers work with credit every day and have the incentive to improve the credit as soon as possible so are your best source for home loans. Wait and talk with one before you do anything with your credit. Its easy to do the wrong thing. So the key is choosing the loan officer. Read, Consultation Interviewing Loan Officers at Your-Road-Home.com. Gather up all the information you can so you will not only have the right questions to ask the loan officer but will know the right answers. The loan officer and real estate person are critical choices for most people buying homes. Trulia is also a very good source of information and when you are prepared loan officers and real estate agents from your area offer their services on Trulia. A good source. Be sure to read article #9 about the MCC Tax Credit. The best tax credit ever.
Best of Luck, Stephen Webber, 34 years of real estate
For First Time Home Buyers
Web Reference: http://Your-Road-Home.com
0 votes Thank Flag Link Mon May 6, 2013
Hello Tasha,

I totally agree with Don Groff. Now is the time to build an experienced team that will guide you and your husband thru the homebuying process. Your next step would be to obtain a copy of your credit report so you know exactly where you stand. I recommend you speak with a few lenders and decide who you want to work with. Only then should you give permission to have your credit report pulled. Your lender will then be able to make specific recommendations. Do not be in a rush; credit repair takes time. The most important decision you will need to make is who is on your team. Trust your gut on this one. In this market, we all have access to the same tools. The difference is how skilled we are at using the tools.

Best of luck. Stay focused on your goal.

Be well, Mark.
Web Reference: http://markacharles.com
0 votes Thank Flag Link Mon Jan 10, 2011
It's really hard to say without knowing what your credit looks like. If your credit is horrible as you say your first priority needs to be to get it moving in the right direction again. Go speak with a lender or broker who will take the time to get you where you need to be. It takes time but if you can find somebody patient who will work for you that is your best option at this point.

Don Groff
REALTOR | Mortgage Broker
Keller Williams Realty | 360 Lending Group
512.669.5599
listings@dongroff.com
0 votes Thank Flag Link Mon Jan 10, 2011
Tasha, give us a call. We may have a perfect program for you and your husband. It is not credit score driven but based on how you have hamdled your finances lately. Mike and I have helped literally hundreds of people become home owners when they started off in a similar situation to yours. Every one presents new and different challenges so it might not happen overnight but we can definitely put you on the right course.
Michele 469/241-0000
http://www.2MTexas.com
0 votes Thank Flag Link Sat Jan 8, 2011
Hi Tasha

Yes some loan agent will be able to get you a loan, the standards are very tough now-a-days.

Check with. http://Www.amerisave.com. Or http://www.penfed.org

Hope this helps.

Perry
Web Reference: http://www.ruthandperry.com
0 votes Thank Flag Link Sat Jan 8, 2011
Few options

1) Clean up your credit BASED on what is on your credit files can take approx. 60 - 90 days they apply for a loan.
2) Save you time have either one of you worked for 2 years or more at the current jobs. If NO you more than likely declined for a loan all lenders require at least two years employment.
3) Lenders will take the income on person who is applying for a loan.
4) Do you have anyone who can purchase the home for you till you turn your credit issues are resolved.
5) Lease property clean credit save for down payment then purchase.

DIRECT LINK HOME BUYING:
http://www.lynn911.com/Web/AR287090/CustomContent/index/5046766

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
972-699-9111
http://www.lynn911.com
0 votes Thank Flag Link Sat Jan 8, 2011
According to Tom - "You will find two types of 'professionals?' on this site. "

1. Those that help without judging.
2. The judgmental & arrogant.

Actually, Tasha, you will find many more types of "professionals" here than the 2 Tom listed.


No one was "judging" you Tasha.

Advising someone who states they have "horrible credit" to wait before buying, and to improve their credit scores is hardly being arrogant!

I call it being prudent..... but to each his own.

Neither Don nor I have any pony in this race................but even if you could be a potential client of mine, I'd still tell you to get your finances in order before looking to buy a home.
Otherwise, you might find yourself on thin financial ice.

Best wishes............
0 votes Thank Flag Link Fri Jan 7, 2011
Here is how it works - if his credit is used, his income has to qualify on its own. Since you describe his credit as fair and yours as poor, take some steps to bring up both your scores. Pay off unpaid bills, reduce your debt, lower your credit card bills. Above all, speak with a professional who can help you. Try Consumer Credit Counseling (a company) or something similar to help you raise your credit scores. At the present time, with fair and poor you might not qualify.
0 votes Thank Flag Link Fri Jan 7, 2011
I rarely respond to a question with saying I agree with someone, but in this case I am compelled to say: "I agree with Don....... wholeheartedly"!

Just because someone out there might say they get you a loan, doesn't mean you should .
Your priority should be improving your credit, and making sure you don't get in that position again.

I don't know specifically what you mean by "very bad" credit, but anything below the mid 600's needs to be addressed.

Come up with a plan - speak to a financial advisor - and get those numbers up. Only then should you look to take on the financial responsibility of home ownership.

Best wishes..........

ps Oh, and to answer your question - you would need to be on the mortgage in order to include your income, so yes, your poor credit would come into play....
0 votes Thank Flag Link Fri Jan 7, 2011
I am a loan officer with a bank and I have been in the lending industry for 13 years. The short answer is NO, not through a bank or a lender that uses FNMA, Freddie Mac, GNMA, VA or FHA as a means to offer you financing. And if anyone trys to tell you that you can it do it under those programs they could be committing loan fraud.

2nd answer would be private lending where they make up their own individual guidelines, this would be the route to go under your circumstances. Example, I work with a private investor that buys a home in the area that you would like, renovates the house to your spefications and then they seller finance the property to you. The rates range from 6.5%-7.5% and the down payment is 3% and the closing costs are less than $1000.

3rd concern is your husband is a barber, they usually receive allot of cash or cash tips so therefore he would be considered self employed, 2 years tax returns would be needed and it would all depend upon his schedule C and how much income he is claiming. UNLESS he is on a W2 and is under a salary as a barber, which is rare.

4th would be to address the credit issues you have and take corrective measures to get back on track. That would be the reasonable and responsible thing to do.
Jeremy
0 votes Thank Flag Link Fri Jan 7, 2011
Hey Tasha,

There are some great Loan Officers out there and I know one that has programs for credit challenged individuals. If you'd like to call me, I can refer you to those that are VERY good at what they do and can possibly help you!

Best Regards,
Kim Stover-Schumacher
0 votes Thank Flag Link Fri Jan 7, 2011
Tasha,

Best thing to do is get with a loan officer. My guess is that if you have a large income, a good loan officer might be able to clean up your credit quickly. Credit scores are largely based on paying on time and access to credit, so it might just be a matter of paying off some credit, disputing invalid items, paying off small items, that can improve your score.

Let me know if you need a referral to a great lender.
Web Reference: http://www.teamlynn.com
0 votes Thank Flag Link Fri Jan 7, 2011
Bruce Lynn, Real Estate Pro in Coppell, TX
MVP'08
Contact
No.
For you to use YOUR income, you would have to be on the loan.
Sorry

http://dallasloanguy.com/docs/about_credit.pdf
Here is a free resource for you to start cleaning up the credit.


Tom Burris
Mortgage Banker
DallasLoanGuy.com
214-763-4629 cell/text/nights/weekends
tomburris@dallasloanguy.com
0 votes Thank Flag Link Fri Jan 7, 2011
Just how bad is your credit--if you haven't done so yet, consider visiting with any qualified loan officer, after reviewing your overall finances, debt, etc., he/she can make a determination on qualification--if you don't yet qualify for whatever reason, he/she may offer great suggestions as to what needs to be done in order to qualify in the very near future--then go from there
0 votes Thank Flag Link Fri Jan 7, 2011
I can help you get non-traditional financing through a Private Lender who has a program that is NOT credit driven. The interest rate is 5% and you'll need 5% down payment and 5% for closing costs.

If you would like more information, please call me or email me: (214) 293-1831 or SarahMontesKW@gmail.com
0 votes Thank Flag Link Fri Jan 7, 2011
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