For an FHA mortgage, most lenders require a 640+ credit score since 2008/2009.
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% minimum 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. FHA loans will allow a seller contribution toward closing costs/pre-paids of up to 6% of the sales price.
To begin improving your credit score, 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.
All liens and judgments will also need to be paid in full. These impact the title position of a mortgage so they must be satisfied.
It is very important that you be VERY careful in disputing accounts. You cannot dispute accounts which you know to be accurate. For a mortgage, you cannot have an active and open account that has a disputed status. Fannie Mae/Freddie Mac/HUD all have very specific guidelines to be followed when a borrower has an account in a disputed status. In some cases, it could cause you not to be able to qualify.
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.
If you are looking to purchase a property, 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 mortgage options. To get Pre-Qualified for your purchase, you can submit your request online at http://www.rodneymason.com to get started.
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 mortgage lending experience.
Prospect Mortgage offers a full selection of mortgage programs including:
Conventional | FHA | FHA 580-639 FICO | FHA 203(k) Renovation (Streamline & Consultant) | HomePathÂ® | HomePathÂ® Renovation | HomeStyleÂ® Renovation | VA | USDA | GA Dream | Jumbo Financing.
If you'd like I can put you in touch with the lender in my office to get you on track and when you're ready we can start looking at homes.
It will be difficult to purcher with your current credit scores even with a good income. If someone did do a loan the rate would be huge because of the credit scores. Work on cleaning up your credit. That is first and foremost. Call me with questions 404-372-7335
ACCESS COMMUNITY REALTY TARGET CUSTOMERS THAT HAVE FINANCIAL ISSUES SIMILAR TO YOUR THAT WOULD HINDER THEM IN OBTAINING A MORTGAGE TO PURCHASE A HOME.
I PROVIDE CREDIT REPAIR SERVICE THAT INCLUDES BUDGETING AND FINANCIAL GOAL SETTING. I WOULD LIKE TO GO OVER YOUR CURRENT SPENDING HABITS AND HELP YOU TO ADVISE A PLAN TO PURCHASE YOUR HOME.
IN ADDITION TO RESTORING YOUR CREDITWORTHINESS, I CAN HELP YOU TO START BUILDING GOOD CREDIT.
PLEASE CALL ME FOR MORE INFORMATION.
ACCESS COMMUNITY REALTY
Chuck Green, Realtor
Keller Williams Realty
Also, be careful about â€œcleaning upâ€ I linked some info below, hope it is helpful, good luck,
NMLS # 6395
Financing Kentucky One Home at a Time
I answer questions about financing real estate based on my decades of experience dealing with mortgage underwriters. This answer is my personal opinion, has not been reviewed or approved by the company I work for. I do not offer legal or tax advice, if you need answers from an attorney or CPA find one knowledgeable in your local market.
I agree with Tiffany you need to speak with a lender who can assist you with which debts you need to clear up and how each debt will affect your credit score. I know a couple of lenders who can assist with that. Please feel free to give me a call if you need the names and numbers for a couple of them.
Solid Source Realty Inc
Let's discuss in further detail how we can come up with a game plan possibly sooner than 12 months if at all possible.
be pleased to provide their contact information. I am confident they can answer your questions and offer suggestions for your home purchase.
My contact information:
C-Text/404 234 9418
I look forward to hearing from you and to assisting you and your husband.
Elizabeth Walton, Realtor
ASP, CFIS, DPP
Keller Williams Realty