will i qualify for a home loan for 35k with a stated income loan and credit score of 580 in wisconsin?
See, I have good things on my report however, I have like 16 old medical bills dating back since 1999 on my report too. I only owe 1 credit card that is open 240 that i plan to pay off in one month tops. my school loans are current. thing is, i piggybacked someone else's credit to try to raise my score and the payment histories on their credit cards are good. i'm not sure if that would help me or harm me considering the balance on all their cards are over 1000. i want to keep history separate now but those creditors don't have me on file with the piggybacker, which is ok i suppose. i just need to raise my score asap and don't know how. any advice?
What exactly is a mortgage late? The loan to value hasn't been determined yet but I haven't had the property appraised. I'm trying to prequalify for the loan first, then get the appraisal, then make an offer based on the loan. I was told that TransUnion is the harder of the 3 credit bureaus. I'm hoping to qualify for 100% financing somehow. It's funny that I have decent enough credit to finance a $30k truck but I run into issues with qualifying for a 35k home loan expanded over 15 years versus the five years on a car loan.
- Anonymous1 decade agoFavorite Answer
FICO Scores and Mortgage Underwriting Decisions
FICO scores are only "guidelines" and factors other than FICO scores affect underwriting decisions. Some examples of compensating factors that will make an underwriter more lenient toward lower FICO scores can be a larger down payment, low debt-to-income ratios, an excellent history of saving money, and others. There also may be a reasonable explanation for items on the credit history which negatively impact your credit score.
They Don't Always Make Sense
Even so, sometimes credit scores do not seem to make any sense at all. One borrower with a completely flawless credit history had a FICO score below 600. One borrower with a foreclosure on her credit report had a FICO above 780.
Portfolio & Sub-Prime Lenders
Finally, there are a few "portfolio" lenders who do not even look at credit scoring, at least on their portfolio loans. A portfolio lender is usually a savings & loan institution who originates some adjustable rate mortgages that they intend to keep in their own portfolio instead of selling them in the secondary mortgage market. They may look at home loans differently. Some concentrate on the value of the home. Some may concentrate more on the savings history of the borrower. There are also "sub-prime" lenders, or "B & C paper" lenders, who will provide a home loan, but at a higher interest rate and cost.
Running Credit Reports
One thing to remember when you are shopping for a home loan is that you should not let numerous mortgage lenders run credit reports on you. Wait until you have a reasonable expectation that they are the lender you are going to use to obtain your home loan. Not only will you have to explain any credit inquiries in the last ninety days, but numerous inquiries will lower your FICO score by a small amount. This may not matter if your FICO is 780, but it would matter to you if it is 642.
Don't Buy A Car Just Before Looking for a Home!
In conclusion, a word of advice not directly related to FICO scores. When people begin to think about the possibility of buying a home, they often think about buying other big ticket items, such as cars. Quite often when someone asks a lender to prequalify them for a home loan there is a brand new car payment on the credit report. Often, they would have qualified in their anticipated price range except that the new car payment has raised their debt-to-income ratio, lowering their maximum purchase price. Sometimes they have bought the car so recently that the new loan doesn’t even show up on the credit report yet, but with six to eight credit inquiries from car dealers and automobile finance companies it is kind of obvious. Almost every time you sit down in a car dealership, it generates two inquiries into your credit.
Credit History is Important
Nowadays, credit scores are important if you want to get the best interest rate available. Protect your FICO score. Do not open new revolving accounts needlessly. Do not fill out credit applications needlessly. Do not keep your credit cards nearly maxed out. Make sure you do use your credit occasionally. Always make sure every creditor has their payment in their office no later than 29 days past due.
And never ever be more than thirty days late on your mortgage.
- 1 decade ago
There is alot of information needed to answer this question ... do you have any mortgage lates in the last 12 months? What is the LTV (loan to value) of the property using 35K? The problem you are going to run into is with the stated income part. Depending on the LTV you might not be able to go stated.
I just looked at one of my sub-prime lenders guidlines for wisconsin, if you have no mortgage late you can finance up to 90% LTV stated, if you have up to 3 30 day lates and no 60's then you can finace 85%, if you have 1 60 than you can finance 80%, if you have 1 90 than you can finance 75%, if you have a 120 you can finance up to 55%. Your rates are not going to be good however.
If you are just looking to prequal then your LO should be loking at your income, and your current debts to figure out your current debt to income ratio. Once he has your DTI then he can figure out how much you can afford, and at what interest rate to keep your DTI at level that is acceptable to the lender. Once that ahs been determined, he can tell you what amount of loan you qualify for. Then you can figure out how much you qualify for, and how much you have for your down payment. Once you know the total you can spend, you need to look at what LTV you will qualify for. Once you know all this information (it really only takes a few minutes, even though it sounds long and drawn out .. lol) you will know what price range on home you are looking for.
As far as mortgage lates, if you have never had a mortgae before than you do not need to worry about it. If you have had a mortgagge before then it is how many times you have been late (30+ days), and how late you were.
I am afraid that it is going to be hard, or near impossible to obtain 100% financing with your current credit score. the reason you are able to obtain a laon a vehicle and not on a mortgae is because mortgages are sold in the secondary market to investors, where as cars are not. There for there are guidlines that a borrower must meet in order for the loan to be marketable on the secondary market.
What is your credit like? Is it possible to clean up, and do a rapid rescore on?? If it is, then that might be a good way to go. However be carefull about what lines you adjust. For example, if you have a collection that is 2 years old, paying it off will possible be counter productive because it will now apear as a new derogotory trade, as opposed to an old derogotory trade. So you will gain some ground by showing it as paid off, but will lo0se ground because now it is currently a bad trade line as opposed to being a mistake in the past. It is a catch 22.Source(s): I am the owner of ASK Financial Services in Saint George, UT. firstname.lastname@example.org
- tiarawright2008Lv 51 decade ago
Probably it depends you will probably need a coborrower my fiend just got a house and her crdit score 550. I think it depends.. but i know the minimum is 550 i do believe
- Anonymous1 decade ago
probably, but not with a good interest rate with a 580 score
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- Anonymous1 decade ago
maybe, it depends on the size of the loan. you can get a loan, but not a big one.
- brothergrimiamLv 41 decade ago
Not unless you talk to someone about a mortgage.