What does my credit score need to be for a $175,000 loan?

Asked by Inquiring Mind, 34251 Tue Feb 28, 2012

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Mark R. Barrett’s answer
Mark R. Barr…, , Bakersfield, CA
Tue Feb 28, 2012
For conventional loans you need 620 FICO then your total debt with house payment (DTI) compared to your average gross income over the past 2 years** needs to be under 45% and maybe lower to qualify. That’s 45% DTI. Calculating income correctly needs to be done by your loan officer though, that was just a general rule of thumb and only applies a small percent of time. For FHA loans if you have 500-579 FICO you need 10% down and a lot of other supporting documentation as why you deserve a loan amongst many other details. Max DTI would be 41% and rate as high as 4.25 and maybe even higher like 4.5% on extreme cases. 580-639 FICO your DTI needs to be fewer than 50% and in many cases under 43% if your file is not strong and the reason for the low FICO score not accepted as a good reason. For FHA loans over 640 FICO you can qualify with a house payment of 46.99% of your gross monthly income with a max of 56.99% with your total debt to include house payment. So the math is up to you now. Examples: 1,000 a month income. For 500-579 FICO your total debt to include house payment needs to be under $410 per month. For 580-639 FICO in varies and can be 43% to 50% and higher in some cases. So $430-$500 house payment. FHA loans over 640 FICO on $1,000 monthly payment your total debt can be $569 with a house payment no larger than $469. As a general rule of thumb for FHA count $7-7.25 per thousand in home price to get your total monthly payment PITI. i.e. 175,000 purchase prices payment with 620 FICO would be $1,268 give or take $20. Now you can do the math to see how much you might qualify for. Of course there is a lot more to qualifying and pricing loans but hopefully this gives you a rough idea to answer your question. You can always email or call me to clarify. Find a loan officer your real estate agent you work with likes or you got referred to.
0 votes
Ray And Karen…, Agent, Mount Dora, FL
Tue Feb 28, 2012
Hi!

It's a combination of credit score, LTV, Assetts and Debt to income ratio.

Probably lots of great lenders here on Trulia to get you started.
0 votes
, ,
Tue Feb 28, 2012
You can’t get a complete answer from only a piece of the puzzle. Most borrowers fixate on only one point like credit scores, that is not how a loan application is underwritten, it is considered in its entirety. The best move is to have your Realtor introduce you to the loan officer they trust the most, meet with them personally and review all of your support documents not just a piece or two.
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Antonio Vega…, Agent, Saint Cloud, FL
Tue Feb 28, 2012
Actually the question is constructed incorrectly. Score will not give you the amount, free available income will.
So the question is: How much available income do i need to have left after monthly expences to qualify for a 175K loan?, and then a second question: At what interest rate will my loan be if my credit score is____?

Loans are now available for CScores as low as 580 if you have the available income and not mind paying slighly higher rates...which are still really low this year.

You need to consult a local lender and ask those 2 questions.

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Tony Vega
Charles Rutenberg Realty
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