Home Buying in Harper Woods>Question Details

Latrese Thed…, Home Buyer in

if i do not have good credit, is it still a good idea to attempt to buy a home?

Asked by Latrese Thedford, Fri Nov 9, 2007

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It is my opinoin that lending criteria will tighten up more in the coming months. This is simply my opinion. I do not work in the mortgage industry. Last time I checked, they don't have crystal balls, either. But, we all try to make our best predictions. I anticipate more negative news in the media, and as a result, both lower interest rates, and tighter guidelines for loans.

If you can improve your score in the upcoming months, it may be worth it to wait. If you have no reason to expect any changes, see a lender and ask them what you might qualify for now.

FHA will allow you to put down less $$ and be less strict on the credit scores. Your desired purchase price points will make a difference in your options.

Only a lender can give you an accurate answer and guide you according to your income, down payment monies, and credit history.
2 votes Thank Flag Link Fri Nov 9, 2007
Deborah Madey, Real Estate Pro in Red Bank, NJ
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I am a mortgage lender. The best thing to do is to find a reputable lender and get pre approved or pre qualified. A lender will tell you how much you can afford based on your income, debt and downpayment. If the answer is not now, they can guide you the fastest way to repair your credit so you can buy something (everyone should always be trying to maximize their credit profile). And it is harder now to get a loan and will continue that way for a while. But it never hurts to try.
1 vote Thank Flag Link Fri Nov 9, 2007
Latrese, This may be a good time to purchase a home in Michigan. Here is a list of Housing Counseling agencies offered through HUD http://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm?webListAction… most require a fee. There may also be free counseling available though Wayne County.
1 vote Thank Flag Link Fri Nov 9, 2007
I'm not sure whether the question should be "Is it a good idea", and not, "Will I be ABLE to?"

Depending on just how bad your credit is, you may or may not be able to obtain financing, for one. Even if you are able to obtain financing, you may not be able to obtain the best rate available to you.

IS it a good idea? Well, it depends on your situation outside of your 'bad credit'.

Are the circumstances that impacted your credit negatively now under control? Are you able to now repay your debts in a timely and responsible manner so that taking on yet another financial commitment will not further impact your credit? Are you actively taking steps to improve your credit?

It is hard to say whether or not it is a good idea to attempt to buy a home without knowing more about your specific situation. You can meet with a lender that can help you honestly assess whether or not buying a home right now will not only be feasible, but a good idea.

The best thing you can do is to work towards improving that score. In the case you have not already been counseled on how to improve your credit score, here is an article that may be a good start: http://articles.moneycentral.msn.com/Banking/YourCreditRatin…

If are actively working towards your goal of improving your credit, and your creditors can see and attest to this, you will be on your way.

Good luck to you.
1 vote Thank Flag Link Fri Nov 9, 2007
Talk to a reputable lender. Someone before me made a comment about a 550 credit score getting approved....my experience in the last several months is that this is not happening anymore. Mortgage guidelines have become stricter. I'm seeing lenders approve 620+ scores...there may be some that are offering way higher interest rates for lowers scores, but my understanding is that they are far and few in between.

If you are not sure where you stand with your credit, get the exact number. Call and meet with a reputable lender and figure out what your credit score is, what your debt to income ratio is (this will affect the amount of money the lender is willing to loan you), etc.

You may be ready to buy if your credit is descent enough, if your debt to income ratio is descent, if you can organize your bills and finances to where you can comfortable afford a home.

The bottom line is that it is always a good idea to buy your own home--if you do buy, stay in it 3-5 years minimum and you should see it appreciate. I hope that you find out soon about your ability to buy...good luck with that!

Adelina Rotar
Web Reference: http://www.RotarTeam.com
0 votes Thank Flag Link Fri Nov 9, 2007
what is good credit? I know someone who had a credit score of 550 and was able to get a mortgage. You should talk to a lender and have him/her tell you what you need to do to get a aproved for a home. The higher your score the better your interest so you do what to get your score up as many points as possible so you can get a good interest rate.
0 votes Thank Flag Link Fri Nov 9, 2007
If you can get qualified, it is a good idea to buy in Michigan. Let me know if you want a good lender. She is VP of a bank and can hold loans in portfolio and not sell them.
Web Reference: http://MissyCaulk.com
0 votes Thank Flag Link Fri Nov 9, 2007
Because of declining home prices in some areas, It's a great time to buy if you can. If you can buy a home for no more that you are paying in rent, there are huge advantages. GET PRE-QUALIFIED with a reputable lender. If you can't buy right now, a good lender will put you on the right path so that you can purchase a home as soon as possible. Just don't get in over your head. Owning a home is better than NOT owning a home. FHA approvals are not based on credit scores, have a low down payment that can be gifted. So if you can afford the payments, by all means, this is a great time to buy !!
0 votes Thank Flag Link Fri Nov 9, 2007
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