You have made the MOST IMPORTANT observation already.
That observation is, "My credit is not great."
Their is significant temptation to circumvent the consumer protection in place to protect YOU. They are hard to resist. You must do so! Failure to resist will produce an end result that will leave you in a much more dire situation.
There is only ONE option you should consider. That options is:
1. Fix your credit!
By doing so you will SAVE MONEY! Lots and lots and lots of MONEY!
At all costs you must avoid walking into the lobby of Wells Fargo, Chase, Bank of America an Citi bank.
You do want to consult with an organization who has a history of investing in your community through small business loans and home loans. IN your consultation, express your desire to purchase a home and your willingness to restrict your spending, reduce your revolving credit and save as well as follow the guidelines they will provide to restore yout credit allowing you the ability to purchase a home. They will tall you how long it should take and what price point you will be able to purchase at...if you succeed in your disciplined efforts.
Clearly the very best choice is a local Credit Union. They are 'hands-down' the lowest cost provider of home loans. They, however, also have higher requirements. It is truly worth looking into.
You next choice is to identify an "A" or "B" graded lender in the area of your interest. These are the lenders who have a historical record of investing in the community. You will Notice all the biggies are all "F" graded. Simpy enter your city or zip and select the lender most convenient to your location.
Go to: http://www.BankingGrades.com
Best of success to you,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
Prospect Mortgage is one of the few direct lenders to offer an FHA 580-639 FICO loan program. Credit profile is a major factor in a mortgage approval. Generally, there should be no late payments, new collections accounts/charge-offs/liens/judgments in the last 12 months. It is required that all open collection accounts must be paid in full if their cumulative balances exceed $1,000.
The 3.5% down payment can be from the borrowers own funds or it can be gifted from a family member. Two months of reserves for the PITI (Principal + Interest + Taxes + Insurance) payment + HOA Dues will be required. This must be from the borrowerâ€™s own funds and not a gift.
You would need to contact each of your creditors directly to see what your options are. Paying off derogatory debt will help improve your credit score in the long run, but not immediately.
With collection accounts, most of the damage is done when they are initially placed on your credit report. Some collection companies are now reporting you are late each month the debt goes unpaid. This continues to drag on many peopleâ€™s credit scores each month until the debt is paid in full. Until you do that, your credit score has little chance of improving.
In exchange for paying the collection account in full, you can try to negotiate to have them completely remove the derogatory item once the payment is received. Some collection agencies will do this, while others will not. You will just have to ask each one and see. If they will not remove it, just having it paid and closed will help in the long run.
To build positive credit, you typically need to have 2-3 trade lines reporting for 12-24 months. There should be no late payments or other derogatory items reported in the last 12-24 months. On your Revolving credit accounts, your outstanding balance on your monthly statement should not exceed 30% of the credit limit.
Working with a knowledgeable and seasoned loan officer is critical in today's market. Getting Pre-Qualified is the only way for you to find out your options. To get Pre-Qualified for your purchase, you can submit your request online at http://www.rodneymason.com.
Rodney Mason, NMLS #151088
Sr Loan Officer
825 Juniper St NE, Atlanta, GA 30308
Office: (404) 591-2453
Apply Online at http://www.rodneymason.com
Licensed in Alabama & Georgia with over a decade of lending experience.
Prospect Mortgage offers a full selection of mortgage programs including:
Conventional | FHA | FHA 580-639 FICO | FHA 203K Renovation (Streamline & Consultant) | HomePathÂ® | HomePathÂ® Renovation | HomeStyleÂ® Renovation | VA | USDA | GA Dream | Jumbo Financing.
I suggest that the program for you is Dave Ramsey's Financial Peace University - probably being held somewhere near your house, soon.
Don't stretch yourself too thin and be so urgent to buy in a seller's market...
See the web reference.