The first step is talk with different lenders. Attend first time buyer seminars. Get educated about various buyer assistance programs in your city (you can google and search in your city === usually these city-specific buyer assistance programs are online).
Good lenders can provide advice on how you can improve your credit scores, etc. But this will all take time. The important thing is to get started and to implement the lender's suggestions.
There's a program called the Nehemiah Program wherein the Seller kick's in some of the monies you will need such as downpayment and closing costs. Here's the link. Check it out. Maybe it will work for you. http://www.getdownpayment.com/
Look into FHA loans.
You may need a bit more savings for a down payment, but the lending guidelines are much more relaxed, and the down payment is as low as 3%.
Not saying "oh yea for sure you can do it!" - it may take a little bit of time and some work - but it is possible.
Take your time, do it right, and don't get in over your head. You can make it happen - but it may take some patience.
Just some general advice: Work on raising your credit score some. Address the medical debts that are in collection. Clear those up; negotiate them down, pay them off. Have your wife stay at the same job, to build up more job history. And stay at your job; 8 years is good.
Financially, sure, it sounds as if you can afford those homes. If you're renting for $900, after tax deductions (I'm not an accountant, so this isn't accounting or financial advice) you could afford $1,200 (maybe more) in mortgage payments. And that would be more than enough for a home costing $130,000.
It's possible to buy for almost no money out of pocket, with some of the programs mentioned below. However, a broader view of your finances might suggest that you should build up more in liquid assets--maybe $20,000 or so.
What you should probably do is set a 6 month-1 year time frame to raise your credit score, build up some additional savings, and add some time to your wife's employment history. And you should immediately talk to a good mortgage broker and start interviewing Realtors, so you'll have a good gameplan and your team in place.
The Sold Team
Century 21 Heritage
717-757-9487 ext. 359
From what you are telling me you sound like a good canidate for some programs. But withour knowing the specifics of exact credit scores and exact debts and collections its hard to tell. There are many programs out there for first time home buyers and especially for your income bracket. There is the USDA loan which lets you include all your closing costs, theres no mortgage insurance, and rates are low but the property must be eligible. There is FHA which requires 3% down but the seller can contribute to that as well. Keep in mind you will have to qualify with taxes, insurance, and private mortgage insurance if required. If you paid off ALL your debts with an income of 45k a year both of the above programs would allow a housing payment with a back end ratio of 41% about $1500 a month. Should you need further assistance please feel free to contact me 800-839-6186x334. Thank you and good luck
Michael D Delp
4802 Old Bethlehem Pike,
Telford Pa. 18969
You need to work with a participating lender familiar with PHFA (their web site offers a list by counties).
I have provided the web reference, below.
Best of Luck to You!
In this day and age, it may be a bit easier then it used to.
I do agree - start talking to lenders and exploring your options. Also do yourself a favor, and do a lot of your own homework as well. The more you understand about all of these things, and the more knowledge you have - the easier the process becomes.