Andy Leron, Home Buyer in Los Angeles County, CA

Loan with no job and poor credit

Asked by Andy Leron, Los Angeles County, CA Wed May 22, 2013

I'm a home buyer in L.A county. I have 570 in middle credit score and am currently looking for a job. I inherited some money from my grandmother, and would like to buy a place under 200k. I talked to a hard money lender, who requires 40% down, 10% interest, and almost 10k in points and fees and closing costs. I know its hard to find a loan for my situation, and traditional loans are out of question. But just a little less stringent than this lender I will gladly take. I can put 40% downpayment, but if the interest can be within 7% and closing cost can be within 2K I'm a happy man. My goal is to refinance after improving credit in a year. Can somebody suggest somebody? Thanks a lot.

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Trevor Curran, Mortgage Broker Or Lender, Great Neck, NY
Thu May 23, 2013
Good morning Andy,

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

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0 votes
Brian Byhower, Agent, Hermosa Beach, CA
Wed May 22, 2013
I've referred Andee Monemoreno of SunWest Mortgage to many of my clients. She can work magic. She's not bound by the same rules and restrictions as the larger lending institutions. If she can't do it, maybe she knows of another lender that can help. Good luck!

Andee Montemorano
Team Manager-Los Angeles, CA
Ph: 714.869.8369
EFax: 866.753.5121
NMLS# 115462
1 vote
carlos parra…, Other Pro, Monrovia, CA
Thu May 23, 2013
Hard money Loans can be very harsh. Maybe you should wait a while.
0 votes
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