When you say $2000 of negative history, whether you have collections, or judgments, or just balances of credit card debt or loans remaining may make a difference in what you may need to pay off or not prior to qualifying. If it is a score that needs to be improved, there are also suggestions for doing so quickly depending on your history and what needs improvement upon. I would definitely contact a loan officer and/or credit repair service to determine what the best actions may be for your situation. Be wary however when contacting a credit repair service to make sure they are legitimate and knowledgeable. Also, depending on how much your score needs to increase prior to qualifying a timeframe can usually be estimated as to how long that may take, and a loan officer and credit repair service can probably give you the best indication of timeframe. With that said, if it is something that likely can be attainable quickly, you are in luck and I would say start looking so that when you are approved you will have an idea of the area market and have made some comparisons as to what you want. If it is a credit repair that may be more extensive, you may consider looking into a lease option where you could move into a home now with the option to buy when you are qualified for financing, or consider a contract for deed, which is a purchase of a home now where you can make payments to the seller directly rather than obtaining a mortgage. That type of purchase can typically be refinanced to traditional finance within 2-5 years once you are able to qualify for financing. Keep in mind with a contract for deed option or a lease option, that will limit the homes available that you can look at as only some sellers will offer those terms. Most homes for sale will require traditional mortgage financing from a buyer. Also, with a contract for deed, most sellers do require a down payment of 10-20%. And lastly, if you do decide to make an offer on a home with a contract for deed, it is recommended that you work with an agent to represent you that is familiar with contract for deeds, as well as have an attorney review documents as there are additional considerations to keep in mind when negotiating a contract for deed. Good luck in your home search and if I can be of further assistance please don't hesitate to ask!
Minnesota Realty Inc.