I have a 606 credit score. Can I get a $100,000 house with no downpayment?

Asked by Mlo, Dallas, TX Tue Jul 14, 2009

Help the community by answering this question:

+ web reference
Web reference:


, ,
Wed Jul 17, 2013
Good afternoon,

We see many credit reports with low credit scores (anything less than 620), and often many scores in the 500's. This is BAD credit. If you are one of the folks affected by this terrible economy, you have a low credit score and you have a dream of buying a home, here's some simple advice for you.

It is unlikely you could be approved for mortgage financing with that credit score at this time.

Beware of any mortgage professionals promising you an approval with such a low score. Wait on buying a home. I recommend you take the time to resolve your credit issues.

First, settle any outstanding debt. If you owe money on collection accounts, charge-offs and/or judgments, make payment arrangements and get these accounts paid promptly.

Next, begin rebuilding your credit. If you have current accounts with good payment histories, or even some previous late-payment-blemishes, make sure you continue to pay those accounts on time. If you do not have any existing credit accounts then you'll need to establish several in order to create a viable credit history.

I have found that CONSUMER ACTION is an excellent resource for objective advice on all things credit related. You'll find free and sincere advice on everything from settling collection accounts to rebuilding credit to building credit from scratch on their website.

Beware of anyone offering to "repair" your credit! The Federal Trade Commission issued a stern warning last year that such offers are scams. Find more from the FTC HERE.

The best way to buy a home is to have a decent credit history combined with sufficient Income and Assets for a home purchase.

The best way to have a decent credit history is to settle negative outstanding obligations and pay all your bills on time for at least two years.

Trevor Curran
NMLS #40140

*If you thought my answer was helpful, please give me a “Thumbs Up” or “Best Answer.” Thanks!
2 votes
You are completely correct. My credit has suffered due to the economy and the lost of my business. Included in that my wife left me so another source of income lost. Instead of losing the home which was close to being paid off, I decided to sign it over to her ( soon to be ex ) fast forward 2yrs later house paid off. Hustled my butt of debt down from 180,000 to 8,709, credit score 621. But during this time 1 negative mark. I applied for a home loan denied. Now I'm working to pay that off. I'm old now, hopefully by Dec 2017 I will have every thing paid off except the one car ( to carry as extended credit over 4 yrs) All resent credit up to date no late payments. GOAL! 2018 . To have a sizable down payment in the bank to purchase another home. I going to be simple no children, I want to purchase a small nice home with no more than a 10yr Mortgage. I'm I on the right track. Also I'm retired military.
Flag Fri May 26, 2017
Jessica Bate…, Agent, Beverly Hills, CA
Tue Jul 16, 2013
FHA really isn't credit score driven, it's the Banks and Lenders that set those score requirements. There are a few lenders that go down to 580 with FHA, I personally have closed on several homes with clients around and under 600. I recommend all my clients that have credit issues to check with The Lenders Network, check them out. If anyone can get you approved they can!
1 vote
T.E. & Naima…, Agent, Dallas, TX
Wed Jul 15, 2009
You can use part of the $8000 tax credit towards your down payment or closing costs but you still have to come up with the minimum of 3.5%. Here is a partial quote from the HUD press release

"Buyers financing through state Housing Finance Agencies and certain non-profits will be able to use the tax credit for their downpayments via secondary financing provided by the HFA or non-profit."

There are of course prerequisites for this loan. Speak to a lender, get your credit score up. You still have a few months to take advantage of this.

Web Reference:  http://www.SumnerRealty.com
1 vote
Dallas Texas, Agent, Dallas, TN
Fri Sep 4, 2009
No down payment loans are thing of the past

You would need save 3.5 % as a down payment budget for closing costs, inspection, appraisal, keep in mind you receive annual tax benefits owning a home

Blog I authored could assist you:

National Featured Realtor and Consultant, Texas Mortgage Loan Officer, Credit Repair Lecturer
Follow me on Twitter: http://twitter.com/Lynn911
Web Reference:  http://www.lynn911.com
0 votes
Kevin, , Texas City, TX
Wed Jul 29, 2009
no, you will not be able to buy the house... You need a minimum score of 620 to go for a FHA loam.... even if you use $8,000 tax credit, then also you require 3.5%down payment... you should try to improve your credit score.... You can use grants as gift from your family members, relatives as down payment....
all the best......
0 votes
David Chambe…, , Saint Petersburg, FL
Wed Jul 15, 2009
If you go FHA you have to come up with 3.5%. the end
0 votes
Dana Schuster, Agent, Slidell, LA
Wed Jul 15, 2009
there are 10 states where you can use the tax credit for additional down paymwnt beyond the required 3.5% for FHA. Texas is not one of them. In addition,your credit score does not meet the minimum 620 required for FHA in this market.There is a RD/USDA program with no down payment,but Dallas is not eligible as a rural area and you would still have to meet credit standards.
0 votes
Heather Peck, Home Owner, Las Vegas, NV
Tue Jul 14, 2009
In Las Vegas we have down payment assistance programs that grant you enough for down payment and closing costs, but you must go through their class and be approved through their program. You need to see if there is something similar in your area. Good luck.

Heather Peck
Las Vegas
0 votes
Michael Dots…, , Salt Lake City, UT
Tue Jul 14, 2009
I don't know about other states, but in Utah, there is a Rural Development loan available that offers down payment assistance AND closing cost assistance. The only requirements are you have to be at or below certain income limits and buy a home outside of the major cities. If you can't afford a lot, a small town is a good way to go anyway though as they are much more affordable. Depending on the income limit, I think they even have the option to subsidize your interest rate to lower your payment.

I believe it is a USDA program so it may be available in other states as well. Here is a website:
Web Reference:  http://www.rurdev.usda.gov/
0 votes
, ,
Tue Jul 14, 2009
Outside of the Dallas area you might find a USDA eligible property.... That (USDA) is 100% financing.
Inside Dallas county? No.
0 votes
Jackie Rankin, Agent, Fort Worth, TX
Tue Jul 14, 2009

Dana is exactly right, except that there are lenders that will loan FHA with a 585 credit score. However, you will still need your down payment of 3.5%. If you could bump your credit score up to 620, and you qualify for the first time homebuyers tax credit, I do have lenders that could help you with the downpayment and closing costs. Just let me know if I can help. Thanks and good luck!

Jackie Rankin
Tru Value Realty
0 votes
Dana Schuster, Agent, Slidell, LA
Tue Jul 14, 2009
Probably not. no down payment loans are pretty much a thing of the past except for VA(for qualified vets) and USDA which will not exist in Dallas. In this market you will need a minimum 620 credit score for FHA with 3.5% down. For conventional with 10-20% down you will need a minimum 720.
0 votes
Search Advice
Ask our community a question

Email me when…

Learn more