Wanting a house, Husband has horrible credit and I have okay credit. What's our best option mortgage wise, can they just use my credit?

Asked by Ruth Campos, Grand Prairie, TX Fri Feb 18, 2011

My scores are 693,685, and 681, his are below 580. Mine should go up next month as we paid off the car repair this month. His are obviously going to take longer.

We're looking into 70,000 and below in our area and have 3500-4000 for a down payment. I have steady income and my husband just recently switched to full time student to obtain the degree needed for a managerial position at his company. We're hoping to buy a house with monthly payments below 500 before November this year. How can we achieve this? What are our best options? Get the mortgage under my name but have the house listed in both our names? What type of mortgage would allow the monthly payment below $500 and have possible money for fixing the house?

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Steve Fergus…, , Austin, TX
Fri Feb 18, 2011

Based on your description it sounds like an FHA loan using your income would work fine. This is called an FHA loan with a non-purchasing spouse which means your husband would not be on the loan but any debt he has would have to be counted when your total debt to income ratios are calculated. The payment you are requesting may very well be possible depending on the monthly taxes and insurance on the home you are interested in. Give me a call or send me an email and I will happily walk you through the process. I hope this was helpful and my contact info is on my website. Have a good day.
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Ruth Campos, Home Buyer, Grand Prairie, TX
Wed Feb 23, 2011
If you're a buyer looking at this question wondering what the answer to it is, it's pretty much what everyone has said below. You need to find a mortgage broker with 20+ experience and have an in-person meeting to analyze your situation.

Then all those wonderful rates and estimates you see pop up online will start to make sense. You'll know which ones are best for you and which ones aren't worth it.

Keep in mind you don't have to use that person for your mortgage if you found a more competitive rate (though since this person took time out of their day to educate you, make sure you show them the rate and see if they can match it. Be fair and honest in all possible business dealings), but as a first time buyer it helps to be educated and have your finances analyzed by a professional.

Now wish me luck, and hope this guy doesn't tell me to raid my 401K instead of waiting another year of saving for down payments and closing costs.
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Don Groff, Agent, Austin, TX
Sat Feb 19, 2011
You really need to speak with a local lender who will take the time to educate you and get you moving in the right direction. You can buy a house with just your credit but if you do that only your income can be used, not your husbands.

There may be things you can do to get his scores up and there are, believe it or not, lenders that actually can get loans done for 600 and below ficos. Hard to believe but I have worked with a few of them. I would recommend getting in touch with a good broker or banker in your area and start looking at your options and ensure you are doing the right things to improve your credit.

Don Groff
REALTOR | Mortgage Broker
Keller Williams Realty | 360 Lending Group
0 votes
Mack McCoy, Agent, Seattle, WA
Fri Feb 18, 2011
This market needs home buyers! Ruth, here's the thing. A credit score isn't a random classification, it's a review - your husband hasn't been good at managing credit, and before the two of you commit to THIRTY YEARS OF MORTGAGE PAYMENTS . . . maybe, just maybe, it's worth putting this off until his credit rehabs.

I like to think of credit problems as injuries; if you sprain your ankle, you're not going to run a marathon - you're going to rehab it and bring it back slowly, so that it won't fold under you at mile 22.

I suggest you two hunker down and rehab that boy's credit until it matches or exceeds yours. Then, and only then, should you sign up for a 30-year marathon of timely payments through hail and high water.

All the best,
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Dp2, , Virginia
Fri Feb 18, 2011
You might also want to consider buying with creative financing?
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Spirit Messi…, Agent, Tucson, AZ
Fri Feb 18, 2011
Please talk with a local lender, or go in to see your bank. You already have a professional relationship with your bank. Both your scores will be taken into account, and the lender can show you were you are now, and what you can do to improve your scores in time. In the meantime, save $ for your money down, have your agent ask for closing costs with your offer and work on your credit. Anything worth having is worth working towards, maybe it may take a year or two but it will go fast.

Start with talking with a lender, it is a free converstion and you can see where you are at and what you need to do to get what you want in the future.
Best of luck.
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Miracle Benn…, Agent, Cedar Hill, TX
Fri Feb 18, 2011
Anytime a buyer has a mortgage question I suggest they call an excellent mortgage person who has been in the business a long time, knows the ins and outs and loves to educate people as to the best to purchase a home.

In Cedar Hill and the surrounding areas that person would be Harlan Cooper. In the business for over 30 years, he knows what getting a mortgage is all about. You can reach Harlan here:
Harlan M. Cooper, Branch Manager

Affiliated Bank Mortgage

972-572-5600 Ofc

972-283-5978 Fax

214-284-5568 Cell

hcooper @transnetloans. com
0 votes
BG, Home Buyer, Phoenix, AZ
Fri Feb 18, 2011
30 Year Fixed Rate
Rate Points APR Closing Costs Payment

5.125% 0.000% 5.416% $3,075.00 $381.14

Plus Tax and Insurance ... It is possible.
0 votes
Candice Wood, , Cedar Hill, TX
Fri Feb 18, 2011
Hello Ruth,
There are other financing options available besides the "traditional" types of financing such as Conventional and FHA loans. At first look, you may be a great candidate for seller financing which would be a privately held mortgage loan with a seller or investor. Feel free to contact me and I will be more than willing to answer your questions.
0 votes
Dallas Texas, Agent, Dallas, TN
Fri Feb 18, 2011
A $500 montly payment are you including insurance and taxes?

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
0 votes
Anna M Brocco, Agent, Williston Park, NY
Fri Feb 18, 2011
Consider visiting with any qualified loan officer(s)-- after reviewing your information, overall financials, credit, debt, etc., a determination on qualification can be made, the type of loan, how much, how much down, etc.; if you don't yet qualify, your loan officer may offer great suggestions as to what needs to be done in order to qualify in the very near future.
0 votes
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