I'm 20 years old and i'm looking to buy my first house, however, I don't have any credit. Help.

Asked by Alex Christianson, Blytheville, AR Thu Jun 30, 2011

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Thu Jun 30, 2011
If you are buying with cash, you don't need any credit :) But if you were looking to get a traditional mortgage like most people do when buying a home, lenders do need to see that you've established yourself in some way... but it doesn't mean you need credit scores.

I wrote complete details out in a blog entry called "No scores? No problem. Just use non-traditional credit." at: http://www.trulia.com/blog/shanethemortgageman/2011/06/no_sc… and it requires you have some forms of alternative credit like utility bills, cell phone bills, rent, etc.

However it only takes 6 months of recent continuous reporting of trade lines (credit cards, student loans, car loans, etc. anything that reports to a credit report) in order to generate a credit score, and then you would find yourself having more financing options. It's something to think about if you eventually find your financing options are limited without scores (which they will be, because not all lenders lend to people without scores - however we do).

Are you renting right now? If so, what are you paying for rent and what would you feel is a comfortable mortgage payment? Have you figured out what the extra monthly expenses of maintaining a home would be? Outside & inside of the home? If you aren't renting right now, are you prepared to start making a payment? How have you prepared yourself, by each month putting away the same amount of money that you would normally be spending on a housing payment?

Please let me know, and if you'd like help figuring things out I'd be happy to help you with that too.
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