my credit score is 647 and going up since paying attention. Problem is the house we want may not be around
long. I can have 10 % on 215K. Should I take that down payment and knock the cc payment down to zero with about 7 k left over for down payment to help the credit rating or keep it for the 10%. My debt to income is about 40% right now including rent.
If you found THE house in Morrilton, jump on it. SHOP your lenders. Fees vary. While they may tell you no origination fee, etc. it is usually wrapped into the interest rate. Consider FHA. Only 3% down. 647 is a score that will buy a house even today. I am licensed all over Arkansas with family in Morrilton. Feel free to contact me. chris.rix@era.com
Michael, Please pay off the debt and get out from under this burden. Obviously you can save up again for a future down payment as you have managed to do so even with the debt. If you just have to have this house, maybe you can pay off your debt and use the remaining 7K to get the seller to carry a note for you until you can refinance and pay off the seller. Your credit scores should continue to increase, you can save the money you are currently paying toward the credit you owe, your debt to income ratio will improve, and you will be a happy person just knowing you don't owe some credit card company, bank, or credit union so much. Houses will be cheaper in one year if you want to wait and find another home.
Keep the debt, use the DP.
I would love to help. Email me, and let's discuss!
martytheloanofficer@gmx.us
Marty
I am online now!
Your question is a little unclear. Is 10% your interest rate? If so, it seems a little high even with a credit score of 647. Check into an FHA loan (3.5% down). You can ask the seller to pay closing costs on your behalf (usually about 3%). FHA loans are somewhat more forgiving on credit scores. Also use a bank, not a mortgage broker, since sometimes closing costs with mortgage brokers are higher. And find yourself a good buyer agent to represent your interests in the transaction. If the home is listed with a realtor, there's no extra cost to you. I would check with your lender as to the best way to utilize the funds you have. And get a "good faith estimate" on whatever loan programs are offered to you. This will allow you to see how much you money you need for closing as well as an estimate of your monthly payments.
I would keep the debt as long as your loan officer approves. Dp is more important in most cases.
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