Home Buying in 94587>Question Details

Lorena Porti…, Home Buyer in Union City, CA

Loan requirements

Asked by Lorena Portillo, Union City, CA Mon Jun 24, 2013

What Criteria is generally needed to get a mortgage loan and buy a home?
I'm a 19 year old female
I know that my credit score isn't great 663 (last time I checked)
What sort of savings, earnings, and other things will I need?
I want to buy a mobile home that cost 30,000 dollars, and I have about 7000 saved up as a down payment.

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Randall Ortiz’s answer
663 isn't as bad as you think. You can definitely get a loan with that score. The lenders may charge you a little more for that score, but you should be able to get a loan. It would also depend on your income and debt to income ratios. Contact me if you need further assistance.
0 votes Thank Flag Link Tue Jun 25, 2013

Looking at normal home buying guidelines for lenders, they would typically like to see 2 years of employment, 2 years worth of job history and 2 years residence in the country before considering most loan applications. Your current credit score is fine for purchasing with an FHA loan.

When buying a condo, house or townhouse, the minimum is 3.5% down and you should be able to cover closing costs (which can vary, but figure $5k to $8k for now - in some negotiations, you can ask for the seller to help cover those).

For mobile homes it may be somewhat different, but it does sound like you may be very close to being able to purchase a home which would be better for a couple of reasons.

First, the resale value will usually be much better and second, you don't have to worry about your space rent fees going up -- which are typically significant. There is also the issue of finding space in a mobile home park. They are very limited (spaces) and there are few (mobile home parks), which is why the space rental is such a premium now.

Hope this helps, but feel free to call or email me with more questions!
1 vote Thank Flag Link Tue Jun 25, 2013
Personally I look at space rent in a mobile home park the same way I look at HOA fees on a condo/townhome. The space rents go up just as HOA feed go up over time.
If someone can offer an advantage one over the other I'd like a good way to compare.
I'm sure a condo/townhome appreciates at a faster rate and more desired by buyers.
Flag Mon Jun 2, 2014
Lorena Portillo,

I congratulate you for your foresight and maturity in planning for your future as a homeowner.

I agree with both John Dutra and Tony Grech that a mobile home is not the best long term housing choice for you. Another factor militating against you in regard to a mobile home is that most of the mobile home parks in the Tri-Cities area are designated as senior parks. In a nutshell…you cannot buy nor live in those parks.

You have done a great job of saving for your future. Continue to do so until you can afford a down payment on a condo or townhouse as your first home. You can find an attractive one bedroom condo in Fremont, for instance, for under $300,000.

Continue to work on improving your credit score.

I recommend that you contact John Dutra whose office is in Fremont for pointers, tips and aid in preparing a game plan to home ownership.

Good luck! I think you have a bright future.
0 votes Thank Flag Link Tue Jun 25, 2013
Hi Lorena

For being 19, you seem to have a pretty good handle on things. You wouldn't expect a young person to have great credit, since you've just started to establish credit on your own. All things equal, 663 isn't a bad score.

Also, you've been able to save up some money, which is not all that common among young people. I see so many that are literally paycheck to paycheck with nothing to show for savings. Well done!

Lenders look at 3 things when approving a loan: down payment, credit, and income. We've just addressed the first two, now lets look at income.

A lender is going to want to see some sort of track record of income in order to determine if you're earnings are likely to be stable enough to support your mortgage payment. Normally a 2 year history is preferred at your current job or line of work. If you don't quite have a 2 year history, but were previously in school then most lenders will make an exception. You'd probably just need to show 6 months or so of stable pay checks.

Now with regards to the type of property, mobile homes are a different type of animal. You may have some difficulty getting financed for that type of property, not to mention like John said the difficulty in reselling this when you decide to move onward and upward.

You should first speak with a lender to get preapproved for a certain amount. Then from there speak to a realtor about finding the right place for you

Good luck!
0 votes Thank Flag Link Tue Jun 25, 2013
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