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Buying a House With Bad or Fair Credit???

Discussion in 'BBS Hangout' started by Dookie Sandwich, Jun 21, 2007.

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  1. Dookie Sandwich

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    First of all, is it possible? I am truly thinking about buying a house because I am sick of living by somebody else's rules (No pets, no parties, privacy issues, etc.). My credit is not in the greatest shape, the last time I checked I was hovering around the 600 mark. :( The good thing about that is I am making strides to pay off my bad debts and I only have 2 left to pay off now. Unfortunately, they are the 2 biggest ones because I payed off my lowest debt first and worked toward my highest. I also have some debts, like student loans, that are there but not bad but I will be finished with school in 08 so I will start paying on those soon.

    Anyway, what are my options? Do I have any options? Is it possible to buy a good house with less than perfect credit?
     
  2. DFWRocket

    DFWRocket Member

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    There are still banks that approve mortgages by doing manual underwriting..ie..not using a FICA score. Find one of them and meet with their mortgage loan officer and explain to him how you are handling your money now as opposed to the past. I know churchill mortgage will do manual underwriting. Shouldn't really be a problem, but what you should do is get out of debt First, then save up for a decent down-payment and try to get a 15yr loan (will save you tens-of-thousands of dollars in interest in the long run). DO NOT GET AN ARM (adjustable rate) MORTGAGE. This is the Main reason there are so many foreclosures today. They are bad news. Good luck and please...Mow and weed your lawn.
     
  3. DFWRocket

    DFWRocket Member

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    wait a minute...Dude...your still in school? what happens if you buy a house, graduate, and then end up with a great job offer on the other side of town? Be patient and wait at least until after you know where your going to be working.
     
  4. Mr. Brightside

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    They have this loophole in the credit system where you can essentially piggyback on someone else's credit. They have services that add you as an authorised user to an person who has a superb credit account on their credit card account, and thus your score gets boosted by as much as 200 points in 90 days. It will cost you anywhere between 500-4000 bucks, but its well worth it if you are looking for a mortgage with subpar credit.

    Its a loophole that regulators are looking into closing, so the time to strike is now.

    Explained here: http://news.cincypost.com/apps/pbcs.dll/article?AID=/20070604/BIZ/706040342/1001
     
  5. Dookie Sandwich

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    I live in the northwest Arkansas-southwest Missouri area and I already have a job where I will be promoted once I graduate so I am not worried about moving away just yet.
     
  6. verse

    verse Member

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    real estate has drastically changed in the past few years. savvy mortgage brokers will tell you that the approval emphasis is no longer solely on credit. to use an old quote: "money talks." if you can come up with 10%, i can almost promise you that you'll find a bank to lend you money.

    if your credit is really that bad (which, it usually is not as bad as people think), pull your credit report. clean up the discrepancies that are inevitably on anyone's report. next, consider consolidating some accounts into lower interest accounts. then, look at opening up 1 or 2 lines of credit and making positive payments on them for 6 months. that alone will help to boost your score.

    oh, and don't close accounts with zero balances. one thing mortage companies look at is "available funds" - what avenues do you have in order to acquire money? so, an open credit card with a low balance, good payment history (6 months +) and a high credit limit, weighs heavily in your favor.

    finally, are you military? i'm in sa, and VA loans are passed out like candy around here.

    as for the person that suggested waiting until you know where you are going to settle down before you buy a house - take that with a grain of salt. find yourself a good Realtor...one highly recommended by numerous friends - OR - one with relatively small experience with a powerful, established broker. make him earn his 3% by finding you a house with a good buying price and good potential to appreciate over the next few years.

    if you have to move, so be it. find a good property manager and rent the place out. if you end up staying, you have a quality property with increasing equity at your disposal. hope that helps!
     
  7. Harrisment

    Harrisment Member

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    This thread prompted me to go get an updated copy of my Equifax credit report, since I haven't done it since buying a house a couple years ago. My score has actually gone up since then, 771!
     
  8. Lil Pun

    Lil Pun Member

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    Is there really anyplace you can get a free score?
     
  9. Harrisment

    Harrisment Member

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    I think there is, but you have to sign up for some crap and remember to cancel it within 30 days or they start charging you. I always just use www.myfico.com. Today I found a coupon, so I got my score for around $14.
     

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