Home Buying in 38125>Question Details

Angela Hunley, Home Buyer in Memphis, TN

what does your credit score have to be in order to qualify for a home loan?

Asked by Angela Hunley, Memphis, TN Fri Jan 15, 2010

If I had a couple things on my credit I needed to pay and I did, how soon would it be before I would qualify for a home loan? If I qualify for the $8000 tax credit, can I use that money to pay off something and then use the rest to help with the closing costs and down payment?

Help the community by answering this question:


Jo Shaner’s answer
You must close first to qualify for the $8000, so you will not be able to use the money prior to closing. You may be able to go FHA, however with shaky credit you may not qualify for the mortgage insurance premium to be financed into your loan (would would have to pay that at closing. In otherwords, your closing cost just went up significantly - and that sounds like a big problem for you.

In some cases, your credit score will increase about 90 days after proof of pay-off. However, with each infraction and depending on how many you have, it may not be enough to raise it up for the minimum you need. If your credit score right now is 500 - you got a long way to go, but if your credit score is 620...you might be close with your proactive measures.

Consult a reputatable loan officer. They are the ones that will be lending you the money and will help you on the right track. You have to play by their rules and a good lender wants to help you. It may not be an easy road and you may not get the tax incentive, but in the long run, it will be worth it for your future's sake.

Good luck,

Jo Shaner
0 votes Thank Flag Link Sat Jan 16, 2010
FHA loans require a minimum score of 620 and 3.5% down. If you haven't visited with a qualified loan officer(s) yet, consider doing so--see exactly what your budget can handle and check the credit score. As for the $8000 tax credit--refer the question to your tax consultant--keep in mind in order to qualify you need to be in contract by Aril 30, 2010 and close before the end of June 2010.

1 vote Thank Flag Link Fri Jan 15, 2010
Your credit score will certainly improve if you pay off some debts and resolve any derogatory remarks, but it does take some time for the score to move significantly higher since it's a record of the past 24 months. Best to get started right away.

You can get free copies of your credit reports every year from


Phil McCollum
BRC Realty Group
0 votes Thank Flag Link Fri Jan 15, 2010
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer