New construction loan concerns

Asked by Marc, Fort Worth, TX Sun May 5, 2013

My wife and I own 10 acres of land in a high property value area. We have no debt, she makes 70k as a nurse. I'm self employed for 3 years and make 85k. I have a mid of 658 and hers is 644. We have 15k in saving. Will we have a hard time obtains financing with our scores? Land is worth 6k per acre. Wanting to borrow 185k.

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9
Andrea Gomez, Other Pro, San Antonio, TX
Sun Aug 18, 2013
Yes FHA loans can finance you with a score as low as 600 with 3.5% down. Check out The Lenders Network they can get you to the right lenders to help.

Good Luck!
0 votes
Bruce Lynn, Agent, Coppell, TX
Mon May 6, 2013
Looks like your scores are low to get construction financing.
A good loan officer at a local bank could probably take a look at your credit to see what is going on.

If you are paying cash for everything, that might keep it low. You both might need to get credit cards for gas and charge and pay for gas each month to get them up.

The self employment part can be an issue too, they'll just have to look to see if you get paid w2 or 1099, how steady the income is, do you take regular steady salary, is it documented with bank accounts and tax records, etc.

That's really how to get started.
0 votes
Stacia Burnh…, Agent, Aledo, TX
Sun May 5, 2013
You are sitting in a fabulous position with the equity in your land. I suggest that you contact a lender and have them advise you of the best avenue to take. I did the same personally on my 21 acres, had it split and got an FHA loan.

If you would like, give me a call or shoot me an email and I will be happy to set you up with an awesome lender who understands the procedures for land owners.
0 votes
Dallas Texas, Agent, Dallas, TN
Sun May 5, 2013
So many particulars are involved when obtaining a loan. Recommend to contact a mortgage broker to assist with all of your questions.

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0 votes
Rick DeVoss, Agent, Ft Worth, TX
Sun May 5, 2013
Hey, Marc!

The first question that pops up is why are you posting a question on the Fort Worth board if you are in Nashville?? You need to contact an experienced loan officer in Nashville. Period. Get one who is familiar with local appraisals. Don't waste your time on here.

IF you were in our area, I could give you better answers. But it seems to me that your scores are fine, and you won't have a problem getting approved for a loan. I don't know why people are telling you to pay down a credit card, when you said you had no debt. Actually, that may be keeping your scores from going up. You NEED some credit card debt! That way you could be making regular, on-time monthly payments, and that is what makes your score go up.

Do not go out and borrow a lot of money on a credit card, but always use one to fill the car up with gas, and then pay it down to a small number each month. Keep a small balance on the card, but make sure it is below 30% of the total credit limit on the card. Your scores will go up.

Your wife makes enough money to get the loan you want. Being self-employed (as I am) makes it harder to qualify, so be prepared to pull out the last 3 years of tax returns. Get your docs in order, and you'll be alright.

Good luck on the project!

Rick DeVoss

ULTRA Real Estate Services

817-300-6121

Direct: RickDeVoss@Realtor.com
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0 votes
Rich Homer, Agent, NAPLES, FL
Sun May 5, 2013
Best next action is to ask a local Mortgage Broker by clicking "Find a Pro" in the main menu at the top of this website. http://www.naplesrealestateguys.com/
0 votes
Marc, Home Buyer, Fort Worth, TX
Sun May 5, 2013
Also we are in Nashville tn
0 votes
Marc, Home Buyer, Fort Worth, TX
Sun May 5, 2013
Just pulled all 3 scores equfax 685 trans 659 experian 644
0 votes
, ,
Sun May 5, 2013
I don't know any Traditional Lenders who will go below 680. The best way to raise those scores to take one credit card as time and attack the balance. Don't spread your payment over several credit cards as this will serve you well. Take the account that has the lowest balance with the highest credit score, then so on. Your score is fine for either FHA, VA or USDA financing. Most clients I know that can't qualify due to past bad credit, previous short sale etc, that want to either buy investment homes to fixing them up then flip them or doing spec home construction are using Private Money. As long as the LTV is low enough your credit scores are basically irrelevant.

Best of Luck!
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