Not only can you get an FHA loan here with 3.5% down or less, there are some lenders that will do it with a credit score lower than 620, but more importantly, there is a HUD program called the Neighborhood Stabilization Program (NSP), through which you can buy a home with little to nothing down and the city or MFA (outside Abq city limits) will subsidize you up to $50k by providing a soft 0% second mortgage! What does this mean? Well I found one for my daughter's 2nd grade teacher, and it worked like this: the house was purchase by a local contractor for $120k and he spent $50k to remodel it. My daughter's teacher and her husband then put it under contract for that total of $170k, but they only qualified for $120k, so the city subsidized the remaining $50k, meaning they are now living in a fully remodeled 1800 sqft 4BR 2Ba home near Eubank and Constitution paying only $862/mo! Now, if in the city, the soft second does need to be repaid when they sell it, whether that is five years or 50 years, but they never have to make a payment on it! If this house was in Rio Rancho, it would fall under MFA's administration of the program, and they offer full forgiveness of the soft second mortgage if you live in the home for 10 years! So, you can see how this can accelerate your financial plans, and put you in a nicer home than you might normally afford! Please contact me any time for a list of these homes, there are only about 15 or so left, not sure if more funding will extend the program, so act now. Happy House Hunting!
There are some lenders out there still lending on lower scores. But they may require a larger down payment.
And as far as your credit score difference? I have seen as much as 100 point difference. That is because there are three different modules that credit scores are determined on. One is the consumer aspect (credit cards), which is the one you get online, auto loans, and mortgage loans. They all 3 have different things that are more important then the others. So you could possibly have different scores on all 3.
Just work on establishing your credit, lower your balances, and pay on time and your score will rise. Don't close any accounts or open any more unless you don't have at least 3 tradelines. Be sure to keep copies of your rent payment cancelled checks or bank statements to show timely rent payments.
Josejose, "not well" is the answer. You gotta have a score of 620+ to get the best rates. You could work with a credit repair company like LexingtonLaw.com to fix it. You should be able to get into the upper 600s or 700s in a few months if your credit is not a complete disaster. They can fix a lot for you -- make sure you keep on top of it though.
You can read my blog series Top 10 Credit Myths at the link below. Good luck!... more