Home Buying in Wesley Chapel>Question Details

James Higgins, Home Buyer in 34668

Looking to buy our first home. Are we able to?

Asked by James Higgins, 34668 Mon Apr 9, 2012

My girlfriend (and future wife) and I are looking/wanting to buy a home in the Wesley Chapel area. We have a daughter together, we both work full time and have $5000 saved up. The biggest problem I have right now is I know my credit score is not great, it's probably around 600 but I don't know for sure. Is it possible to accomplish if my score is that low with only $5000. Also I've heard about usda home loans for that area that cover most, if not all, of the financing but no one I've talked to so far can give me details about how to go about obtaining one. If anyone knows about them can you please provide me with even a little bit of information.

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Bill and Lois Szydlowski’s answer
James,

Having worked with many young couples liked yourselves who have bought a home in the Wesley Chapel area, We are very knowledgeable about what it takes to get it done. Every deal is different nowadays since the banking rules and regs have changed so much in the last year. What I suggest is to find a very reputable mortgage broker, who will work with you, even if the going gets tough. I would interview about 3. Banks cannot offer you any other programs other than what they have. All banks have differing versions of their "overlay", which puts a buffer between the banks minimum requirements and what the actual requirements are from FHA or USDA, etc.
Let us know if we can help.
Bill Szydlowski
0 votes Thank Flag Link Thu Apr 26, 2012
I'm in the same situation as you. I have been told the same, the lowest is a 620 average between the 3 credit agencies. As for calling up banks and and having them run your credit...DON'T DO IT! It's considered a hard inquiry and they HURT your credit scores A LOT. If you want to build good credit you should have no more than 2 hard inquiries a year and that includes those department store credit card offers (I fell for it at Old Navy). What's worse is they take 2 years to come off your report!!
If I were you, I'd sign up for a secured credit card and build up your score by paying consistently and on time, spending only 25% of the available credit on the card a month. Pay ALL your bills on time and ONLY pay up on debt you've incurred in the last 1-3 years and pay them at a monthly pace on time, consistently as opposed to paying it all off at once (that doesn't help your credit either) anything older than 4years..leave it be..it comes off in 7 years and might make your credit WORSE if you pay it! (I know....What?!)
I found a site that's TOTALLY free and you can get your score, it evaluates any debt you have and they send you email updates on changes on your reports. It's called Credit Karma. It's an amazing way to really stay on top of your credit situation. Patience, Consistency and Timeliness is key to getting your score up there.
I'm currently trying to find owner financed homes or rent to own, so that I can get into a house now and work on building my credit so that in a year or so I can try the lenders again. Maybe you should consider those options, the only tough part about that is they usually ask for a heavy down payment (10%) and they are HARD to find! Good luck. I hope all of this helps you out and you get the house you've been wanting!!
0 votes Thank Flag Link Thu Apr 26, 2012
James, USDA is a possiblity depending on where it is in Wesley Chapel. Properties qualify by what zip code they are in. Regarding your credit, the best thing to do is consult with a lender and have them review your information. It does not cost you anything to consult with one and I can arrange for you to contact my loan consultant from Wells Fargo if you wish. She would be the best source of information as there are many different loan packages available. Just let me know. 813-928-2160 http://www.DanTurnerRealtor.com
0 votes Thank Flag Link Mon Apr 9, 2012
Just to clarify my last answer...the amount that you have to put down ($5000) is not the issue. It is the credit score. Even if yo had $50,000 it makes very little difference. In order to get a mortgage you must meet all of the criteria for the particular loan program. Ie;

Credit score FHA, and USDA middle score 620 or above.
Credit score VA (veterans only) 580 with automated underwriting accept finding
Credit score Conventional 80% LTV 660
Credit score Conventional above 80% LTV 680 95% LTV 720

Income: Same job field for 2 years or recent graduation from school with degree in related job field.
Fall into income to debt ratio of published guidlines of loan product (see below)
Fha 31/43, USDA 31/43, VA 41/41 and residual income calculation, conventional 28/36 (note compensating factors such as savings, larger down payment, high credit scores allows ratios to go as high as 50/50 on all products except USDA.) (USDA allows up to a 45 with an energy efficient home).

Collateral (the house): Must appraise for the sales price. Most be in habitable condition and have no safety concerns. Must have a roof life of 3 years or greater. On all loan products...even conventional. If the house does not meet minimum standards a FHA 203ks renovation loan would be the answer to that problem. (min 5k in repairs to 35k maximum)

Published FHA credit scores allow as low as a 520 score with a large down payment. But try and find a lender that actually will do it is another thing. Above is today's reality.
0 votes Thank Flag Link Mon Apr 9, 2012
Hi James!

Based on your credit score you are very close. Work with a lender who will review the credit report and make suggestions that may improve your score.

Many reports have errors and can be fixed very easily witht he right help.

I work with Mary Rhodes of the Mortgage Firm. 352-383-3046.

She has been working with USDA type loans over 25 Years.

Good Luck!
0 votes Thank Flag Link Mon Apr 9, 2012
James,

you will need to talk with a very good mortgage broker. If you did not get your credit score from a mortgage broker, the credit score you quote could be incorrect. Let me know if we can give you the names of a few very good mortgage brokers.

Bill Szydlowski
0 votes Thank Flag Link Mon Apr 9, 2012
Minimum credit score from most lenders is a 620. There are some exceptions to the rule, but very, very rarely can you get under a 620 approved. USDA is no exception. 620 is the minimum on USDA. Even though published USDA Guidelines allow less than a 620 score, you must find a lender to concur. I have searched high and low to find a lender that truly would approve less than a 620 score. Unfortunately I have found many that said they would, but never actually did. However, I have found a lender that will help increase your credit score if you are close to a 620. Usually 580 is the cutoff for free credit repair. You can contact Debbie Myers at Fifth Third Bank at 813-299-9097. deborah.myers@53.com She will walk you thru the steps you need to take to get your score to a 620. She does it for free, and usually can be done within 30 days in many cases, if you follow her exact instructions in a timely manner.
0 votes Thank Flag Link Mon Apr 9, 2012
James,
I would recommend contacting a couple banks/lenders and asking them. They will ask you a few questions to find out how much you are making, what your current expenses are and check your credit and they will be able to give you advice about different loans you may be eligible for. Please feel free to contact me if you would like some names of lenders I have worked with in the past for first time home buyers.
0 votes Thank Flag Link Mon Apr 9, 2012
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