Can I get a house with low income and a high Credit Score. 700 CS?
Just wondering, I am a first time homebuyer. 22 years old and make around $14,000 a year at a part-time job. I attend college and plan on getting a house. The house is $69,900. My father will be living with me and paying the house note, but has bad credit. Is there anything I can do or should I just wait. We like the area and space the house has. I have a 704 credit score and make around $14,000 a year. My father makes around $40,000 a year. he wants the house in my name though. Any advice is useful thank you. And I only have about 4,000 in debt from a tv, laptop, and furniture i owe and have made double payments with no late payments. I reside in Houston, TX. Also could we put up collateral of any other properties owned. Or could we joint own the house. Sorry for all the sentence fragments.
I dont want to be the guy that keeps pursuing something that isn't there, but my parents just got divorced and I don't have money to throw away in renting an apartment. And I would be comfortable living with my father. Would the low-income assistance affect my credit. Or if we did get the 20% down payment.
Fathers credit score s 600
- 1 decade agoFavorite Answer
1. The bank will not consider your father's income if he is not on the loan.
2. Your credit score MORE than qualifies you to get a house. Mortgages are one of the easier things to get since they are so heavily collateralized (you have a house on the line!).
3. The income will be a problem. The bank will only let 45% of your total income be used for debt (that measurement is called your DTI or Debt To Income). So right now, assuming you make $14k a year that's about $1,000 (give or take a little for taxes). Which says you have a little less than $500 a month to put toward a mortgage. Not a bad start, but depending on where you live, that might not buy much.
My advice? You will make at LEAST $10k more per year after school. Save the money now and make a nice down payment later. If you put down more than 20%, you will not have to pay for PMI (mortgage insurance) when you get your mortgage. That will save you a TON!Source(s): 5 years in banking.
- Anonymous1 decade ago
I doubt you could get a loan for that amount of money. credit score is important but lenders look at how much money you make and compare that too your bills each month. I believe they don't want your mortagage payment to be over 20% of your income so with your income being around 1166 per month that leaves you with a about 300 mortage payment and with you borrowing 69K i doubt that would work, even putting down 20% you would still not have enough
- timothy pLv 71 decade ago
A 704 is a decent score but some banks are requiring at least a 720 to receive their best rates.
Your debt to income ratio is likely to disqualify you for a loan like that. You may qualify for low income assistance though.
- Anonymous1 decade ago
I know you want to help your dad but I don't think this is going to work. Mortgage companies don't want to lend you more than 2.5 times your income. So if you make 14k they will only want to give you 35k for a mortgage. So you will only be approved for 1/2 of the money you need to buy the house. If you really want to buy a house I would get a full time job to double your income and you then might be able to make this happen. I know working full time and going to school full time is hard. I did it all through college.
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- MikeLv 61 decade ago
It is highly unlikely that your fathers income can be considered because of his bad credit. It is unlikely that you will qualify alone due to your low income and debt. The easiest loan to get would be a FHA loan but requires at least a 620 credit score plus 3.5% down plus closing costs. Use the following FHA calculator to determine if you may be able to qualify.
- JudyLv 71 decade ago
You might be able to. Ask at your bank. They'll want to feel that you are able to pay the mortgage. Your dad's income wouldn't be considered if he has a bad credit score. The bank doesn't really want collateral of other properties - they sure don't want to end up having to foreclose on multiple properties and sell them.
- bdancer222Lv 71 decade ago
I suspect that even with that 704 (decent but not great) score, you have a limited credit history -- limited history and number of accounts. When you add in your low income, it is very unlikely that you would qualify for a mortgage, unless you have a huge downpayment.Source(s): BD
- Sharon TLv 71 decade ago
You aren't financially ready to buy a house until your consumer debt is paid off. Then you need a down payment, preferably 20%.
If you want to purchase sooner, you'll need to find a seller who owns the home free and clear and is willing to sell to you with owner financing.
- Anonymous4 years ago
I was on Yahoo for something else, then this question was shown on the sidebar...