http://www.trulia.com/voices/Home_Buying/My_daughter_and_her_boyfriend_were_trying_to_get_a-78708credit score, is it true that if my husband and I were to buy a home and not to live in it, but too rent it out to them, that we would need to put down 20% ?? we have excellent credit, so we really would like to help them but we like to use only the money they have for down payment which is about $5,000 is this all for real, would we need to put that much down the 20% ????please help us help them.en-ushttp://www.trulia.com/voices/profile/Other-St_Petersburg_FL-565881/http://www.trulia.com/voices/profile/Other-St_Petersburg_FL-565881/Good Job Tom, Take care of them.Fri, 09 Jan 2009 18:51:05 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-70461-250734/http://www.trulia.com/voices/profile/Real_Estate_Pro-70461-250734/Good for you,Tom! i gave you a thumbs up.Fri, 09 Jan 2009 16:54:48 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-Dallas_TX-307330/http://www.trulia.com/voices/profile/Real_Estate_Pro-Dallas_TX-307330/David, that is pretty much the theme I went with in my private conversation with Stacey. These kids may need a hot water heater one day.... would be nice to get 90 days same as cash with a home depot/lowes credit card. They will need an auto loan one day too... and having a good credit score will keep them from getting a crazy double digit rate. While the mortgage will help the scores down the road with ontime payments, a good look at why they are low now might help them 'manage' their scores going forward. And, being READY for a mortgage is very important.Fri, 09 Jan 2009 16:39:58 -0800http://www.trulia.com/voices/profile/Other-St_Petersburg_FL-565881/http://www.trulia.com/voices/profile/Other-St_Petersburg_FL-565881/Thank you for the kind words Dana. I think educating the public is a good way to go, of course we all want the business but it is more important that it is from someone ready to take on the responsibility.Fri, 09 Jan 2009 16:05:47 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-70461-250734/http://www.trulia.com/voices/profile/Real_Estate_Pro-70461-250734/Thumbs,up David! it's refreshing to read someone's honest response rather than a self-serving post from someone who is afraid to state the cold,hard truth. Home ownership is not a right,it is a privilege that must be earned through hard work I get very tired of wading through posts such as one I read a while back...My husband and I are unemployed and have children. We really want this house($319.000) how can we get help to buy it right now? And then reading answer answer from agents telling them they can take care of everything for them...Just call me and I'll help you! Correct me if I'm wrong,but isn't that the kind of attitude that got us in the current mess?Fri, 09 Jan 2009 15:54:37 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-Asheville_NC-250494/http://www.trulia.com/voices/profile/Real_Estate_Pro-Asheville_NC-250494/Stacey- If you ask your daughter what their credit scores were, it would be helpful. My suggestion would be to do an FHA loan and you and your husband cosign as non-occupant co-borrowers. If they have at least a 550 credit score then I can help them. Below 550 is very difficult in this market. You are more than welcome to call me if you have questions about qualifying or how to better help your daughter. Thanks Luke Allison Flagstar Bank 828-777-8828 Luke.Allison@flagstar.com Apply Online @ flagstarloans.com/lallisonFri, 09 Jan 2009 15:50:07 -0800http://www.trulia.com/voices/profile/Other-St_Petersburg_FL-565881/http://www.trulia.com/voices/profile/Other-St_Petersburg_FL-565881/This is a great time for you to teach your daughter the importance of credit. If she doesn't have a good enough credit score then help her work on it, teach her the importance of paying bills on time. Make sure she has only a few credit cards and that she keeps low balances on them. If she does not have a credit card help her find one because it is important to have a few accounts. Pay off any derogatory charges and contest any inaccurate accounts. It is great that you are willing to help her with getting a home but it is also important that she is ready to buy a home. By the time she is done working on her credit the housing market might be on the upswing, or not. This time could be used to become familiar with the market. I would find a good mortgage broker in your area or credit consultant and work with them on cleaning up any items. There are other qualifications for buying a home and your daughter should become familiar with them.Fri, 09 Jan 2009 15:41:03 -0800http://www.trulia.com/voices/profile/Both_Buyer_And_Seller-Benton_County_OR-580001/http://www.trulia.com/voices/profile/Both_Buyer_And_Seller-Benton_County_OR-580001/Stacy, Why don't you help them rent and repair the credit score? When they are qualified themselves to get a mortgage for a home, then help them...Do you really want to be the landlord? Best of luck, DunesFri, 09 Jan 2009 13:58:55 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-Dallas_TX-307330/http://www.trulia.com/voices/profile/Real_Estate_Pro-Dallas_TX-307330/Stacey, I wanted to follow up. It may be suggested to you that an FHA Non-Occupying Co-Borrower loan will work. In fact, the borrower still has to qualify and low scores will kill the deal. These loans are for borrowers with not enough income or no job. Some lenders also have different credit score requirements. FYI http://www.dallasloanguy.com/wordpress/fha-non-occupying-co-borrower/ The above link explains the FHA Non-Occupying Co-Borrower loan. Let me know if you have trouble with the link, I got error when I tried to paste it here. Make sure you get your advice from a loan officer with FHA experience... Many people have opinions but npot everyone does this every day. If you would feel more comfortable answering the next question privately, I understand. What are the credit scores? Do we know why they are low? Did the lender try to approve the kids for FHA? Not all lenders have access to FHA.Fri, 09 Jan 2009 13:40:51 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-New_Hampshire-193012/http://www.trulia.com/voices/profile/Real_Estate_Pro-New_Hampshire-193012/Stacey in most cases you do need to put at least 20% down. You should however check with a trusted and local mortgage company, they can prequailfy you at no cost and see if there are any programs that fit your need. Depending on credit they may just have something for you, it is worth a try, and try to stay away from internet lenders. good luck with your search.Fri, 09 Jan 2009 13:18:29 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-75182-187509/http://www.trulia.com/voices/profile/Real_Estate_Pro-75182-187509/Many find out they can't buy know, This is the time to clean up credit score or make them better. You can buy later.Fri, 09 Jan 2009 13:13:29 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-Daytona_Beach_FL-280249/http://www.trulia.com/voices/profile/Real_Estate_Pro-Daytona_Beach_FL-280249/Lending answer: The maximum LTV for Investment Properties for loans purchased by Fannie Mae is 85%. That means you will be required to put down at least 15%. However: 1.) You must find a lender willing to underwrite a loan for an investment property at Fannie's maximum LTV. Most lenders now require at least 20% down, many require 25% down. 2.) With 15% down, Fannie will impose a Loan Level Pricing Adjustment (LLPA) of 3.75%. Looking at one bank's rate sheet at random, PAR pricing would mean a rate of 5.75% fixed for 30 years plus 2.75% of the loan amount in discount points. The lender will add an Origination fee and other charges on top of the Discount Points unless you select a higher rate to provide the lender with a YIeld Spread Premium. 3.) You will be required to qualify for both mortgages on income. You will be required to prove 6 months' worth of mortgage, taxes, and insurance payments for both properties in liquid or retirement reserves. 4.) Private Mortgage Insurance will be required for any loan amount over 80% of purchase price. Due to massive losses, the PMI companies have essentially quit insuring mortgages for investment properties. If your daughter and her boyfriend choose an FHA insured mortgage, the downpayment requirement is much less (just 3.5%). You may co-sign to provide qualifying income (without the reserve requirements and avoiding the LLPAs), but all borrowers must meet FHA creditworthiness requirements. Shortly, Fannie (principal buyer of FHA insured mortgages form banks) will impose a minimum credit score requirement for all borrowers at 580. Most lenders have already imposed this minimum.Fri, 09 Jan 2009 13:12:52 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-70461-250734/http://www.trulia.com/voices/profile/Real_Estate_Pro-70461-250734/As a general rule,if you buy a home for investment purposes,which would be any home you rent out & do not live in--not your primary residence you would have to come up with 20-25% down. You could not qualify for a residential loan--this would be a commercial/investment loan. You could exercise certain tax breaks on an investment property. Your best bet would be to speak to a reputable local mortgage broker.Fri, 09 Jan 2009 13:07:36 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-Dallas_TX-307330/http://www.trulia.com/voices/profile/Real_Estate_Pro-Dallas_TX-307330/20% down. Because you cannot find any PMI for more than that. Maybe I can guide them regarding their scores.... http://dallasloanguy.com/docs/about_credit.pdf Have them read this e-book and give me a call.... it is a free download. http://dallasloanguy.com/contact.shtml Let me know how I can help.Fri, 09 Jan 2009 13:07:15 -0800