AAR asked in Business & FinanceCredit · 10 years ago

I have a credit score of 580 and a $20-30,000 down payment? Can I buy a house?

I have bad credit, but a large down payment ready... Can I buy a house? How would I get the loan process started?

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  • 10 years ago
    Best Answer

    You will barely qualify for an FHA loan if at all - but I still want you to try.

    Doesn't matter how much money you have down - it's percentage that counts.

    Call any bank, but check out their mortgage rates first.

    Make an appointment.

    Never buy the max a mortgage person will tell you that you can afford.

    That's a recipe for disaster.

    Don't let your payment be more than 25% of your take home or 31% of your gross.

    And please, don't fall for scam mortgages with changing interest rates.

    Rates are about to go up, up and away.

    I hope this is the myfico.com score - it's really the only reliable one.

    Also consider paying off some of the things on your credit report if you don't qualify.

    Major lenders like FHA do not go by score that much.

    They look at your reports in detail and make their own decisions.

    They will see paid items and adjust their numbers.

    That's why you see some people with horrible scores get mortgage loans - they cleaned up their credit.

    If you consider this, get a book on Credit Repair from your bookstore.

    It will teach you how to negotiate with your delinquent creditors and pay less than you owe.

    /

  • Hugh
    Lv 6
    3 years ago

    For Credit and finance solutions I always visit this website where you can find all the solutions. http://creditandfinancesolutions.info/index.html?s...

    RE :I have a credit score of 580 and a $20-30,000 down payment? Can I buy a house?

    I have bad credit, but a large down payment ready... Can I buy a house? How would I get the loan process started?

    Follow 9 answers

    Source(s): For Credit and finance solutions I always visit this website where you can find all the solutions. http://creditandfinancesolutions.info/index.html?s...
  • 10 years ago

    You are right, 580 is a bad credit score. Even with $20-$30K to use as a down payment you probably will not qualify. But to start the process you will have to meet with a lender ( bank,credit union) to get the paperwork started regardless. That will the way to find out if you can proceed in buying a home

  • 10 years ago

    Yes, you can buy a house if you can find one for that $20K - $30K. But you won't qualify for a mortgage with such a low score.

    You need to clean up your credit. Paying off derogatory items will not improve your score. The damage is done and will remain for the balance of the 7 year reporting period. However, mortgage lenders will require you to resolve all derogatory items on your credit report before approving a loan. You should try to negotiate settlements for as little as you can. Get any settlement in writing and don't give the collector direct access to your bank account.

    You need to rebuilt your credit. If you don't have an open, active line of credit, get a credit card, even if you have to get a secured card. Use the card and pay the balance in full every month. You need at least 24 months to see improvement in your score.

    Source(s): BD
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  • 10 years ago

    Depends on how much the house you are looking at costs. If the house costs say $75,000 to $100,000, you might be able to find a lender. You will pay higher interest (figure around 6.25%). If the house is over say $125,000, your chances diminish quite a bit since some of that down payment will have to go towards closing (figure $5,000 to $7,500) which lowers the amount you can actually put towards the house.

  • 5 years ago

    With the introduction of the FHA home loan, many low-income Americans could afford to get a loan to buy their homes. FHA home loans were designed in 1930′s at the time of Great Depression. The government worked to subsidize loaning programs through FHA in order to face the rising rate of defaults and foreclosures.

    The good news is FHA open to every American. But they have to follow the guidelines laid down while applying for it. To determine if you qualify for an FHA home loan, use these guidelines.

  • 10 years ago

    Use some of that down payment money to pay off bad debt. You will not get a mortgage with a 580 score. Pay off debt & do a rapid rescore. No longer does a big down payment allow for bad credit. 620 is minimum score.

    Source(s): 24 years mortgage lender.
  • ?
    Lv 7
    10 years ago

    The easiest mortgage is an FHA and they want a score of 620. Conventional loans you need 750.

    Time to clean up your credit history.

  • 4 years ago

    What is your credit score? Unfortunately, the days of putting up a chunk of money to have the lender look the other way when it comes to your credit score are gone.

  • 10 years ago

    Doubtful, without jumping through a lot of hoops. I would suggest meeting with a lender to see what you can do to bump up your credit points and clean it up. It will give you peace of mind and only benefit you.

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