Home Mortgage Question

[jthomasou78]

My wife and I are preparing to purchase our first home. We know very little about credit scores, home loans, etc... After college we both were overwhelmed with debt, I got into trouble and ran into trouble with a student loan. She had excess credit card debt. We are now free of all debt except for our two school loans that are current and have been for about three years.

I have a few questions if anyone could answer I would greatly appreciate it.

How long does bad credit haunt you?

Should we be able to get a decent mortgage rate, if we but 15% cash down on a 175,000 dollar home even with decent credit?

If anyone knows I would greatly appreciate it.

[Curly Bill]

Sounds like a Mike Rich question, but I don't know if he's on here right now.

...and having looked, he's not.

[olevetonahill]

You can request your credit report with svores . Contact the 3 Biggies , Ya can look em on Google
The More Down you can Pay the better the Rate will be .
Like KC said Mike can give ya A lot better Idea when he comes on line again

[tommieharris91]

Things that make your credit bad stay on your report for 7 years at the least. There's a website with really annoying TV ads that is good for credit scores (I won't mention them by name). I can't help you with anything else.

[olevetonahill]

Things that make your credit bad stay on your report for 7 years at the least. I don't know about anything else.

Bro they CAN stay on for 7 , But Ive found that Most will drop off in 2 or so.

[tommieharris91]

Bro they CAN stay on for 7 , But Ive found that Most will drop off in 2 or so.

:les: TEH LAW SAYS 7 YEARS!!!!!!!!

[olevetonahill]

:les: TEH LAW SAYS 7 YEARS!!!!!!!!

No Bro the laws say UP to 7 after that It has to drop off :P

[Sooner24]

My wife and I are preparing to purchase our first home. We know very little about credit scores, home loans, etc... After college we both were overwhelmed with debt, I got into trouble and ran into trouble with a student loan. She had excess credit card debt. We are now free of all debt except for our two school loans that are current and have been for about three years.

I have a few questions if anyone could answer I would greatly appreciate it.

How long does bad credit haunt you?

Should we be able to get a decent mortgage rate, if we but 15% cash down on a 175,000 dollar home even with decent credit?

If anyone knows I would greatly appreciate it.


If you did not file bankruptcy I would think you should be fine. I would get a free credit report and see just where you stand. The trick to repairing bad credit is to take out a couple of small loans and pay them off. Don't get a $2000 loan and pay it back in one payment but pay it off in monthly installments. Also if you can get a credit card or two and make some small charges, gas, (wait a minute that's not small :O ), eat out or whatever and pay it in full when the bill comes. Just remember student loans are debt you can never walk away from. They will follow you until the day you die if you don’t pay it off.

[Sooner24]

One more thing DO NOT I REPEAT DO NOT go and buy a car or make any major purchase before trying to get a home loan.

[olevetonahill]

One more thing DO NOT I REPEAT DO NOT go and buy a car or make any major purchase before trying to get a home loan.

Thats a very good Point
It mess's up your Debt to Income ratio.

[hurricane'bone]

Things that make your credit bad stay on your report for 7 years at the least. There's a website with really annoying TV ads that is good for credit scores (I won't mention them by name). I can't help you with anything else.

That website isn't really that good.

Or free.

http://consumerist.com/5035512/another-consumer-scammed-by-freecreditreportcom

[Sooner24]

Go here.

https://www.annualcreditreport.com/cra/index.jsp

[Frozen Sooner]

Go here.

https://www.annualcreditreport.com/cra/index.jsp

Correct.

Do not go to freecreditreportripoff.com.

And yeah, based on what you've said, you shouldn't have much problem qualifying for an FHA loan.

[r5TPsooner]

My wife and I are preparing to purchase our first home. We know very little about credit scores, home loans, etc... After college we both were overwhelmed with debt, I got into trouble and ran into trouble with a student loan. She had excess credit card debt. We are now free of all debt except for our two school loans that are current and have been for about three years.

I have a few questions if anyone could answer I would greatly appreciate it.

How long does bad credit haunt you?

Should we be able to get a decent mortgage rate, if we but 15% cash down on a 175,000 dollar home even with decent credit?

If anyone knows I would greatly appreciate it.

While your credit score is a factor, your Debt to Income ratio is extremely important when purchasing a home. I didn't even know what that term meant until a year and a half ago when we purchased our new home. My wife had a student loan but it was always paid on time and really helped her/our score unbeknown to us. We had some real bumps in the road do to health issues but we always paid our bills which really paid off in the long run. Bankers expect to see bumps in the road, and if they don't... they become suspicious.

The less debt load you have and the more money you make, the easier it is to get a mortgage regardless of your credit score. Our debt to income ration was ridiculously low and made our buying a home a pleasurable experience. We really got our ducks in a row a good year before we purchased just to put some shine on our credit report for the banker...they like that sorta thing.

Mortgage companies also like to look at the last three years as well for some reason, especially the last 18 months. Get ready to dig out bank statements from many moons ago!

I also HIGHLY recommend purchasing the book Home Buying For Dummies. It was the beast $20 that I ever spent and they were right on regarding almost every topic and offered solid advice as well. By the time we closed on our house, that book looked like an F5 tornado had gotten a hold of it.

I also HIGHLY recommend finding a good Realtor/Broker who knows what the hell they're doing. If they try to push anything on you... walk away. Remember, they work for you, not the other way around.

Good luck and tell us how it went.

[jkm, the stolen pifwafwi]

your coming here for mortgage advise? 3 years ago anyone who was not in an interest only mortgage was classified as a moron. :D

the only number i'd question is the 175k number. that is roughly 1400 a month for your abode. do yourself a favor, make sure you don't become house rich and cash poor. if you want some examples of this phenomenae wander around washington while you are up here. the median house price is almost 500k...

[Sooner24]

What part of the country do you live in? If in an area that there are a lot of foreclosures really make some low ball offers and you might get more home for less money. In some parts of the country right now there are some people that would take any kind of offer.

[Tulsa_Fireman]

And don't forget, the P&I on that 175K WON'T be your monthly payment. I could afford up to 120K when I was shopping, and was approved for 130K. I crunched the budget, laid the black numbers against the red, and thought I was good to go.

Until I was reminded about property taxes, insurance, and mortgage insurance which promptly jacked my payment up nearly 200 bucks a month.

Some mortgage companies require you to hold an escrow account up to a certain percentage of the note. Again, someone can tell you better than I, but I'm stuck with an escrow account and mortgage insurance until 10% of the principal is paid (if memory serves). Don't jump off the cliff until you know for SURE, proof positive, what your TOTAL payment will be. Don't bite on the P&I and think you're in the shade like I almost did.

[Frozen Sooner]

your coming here for mortgage advise? 3 years ago anyone who was not in an interest only mortgage was classified as a moron. :D

Ahem.

SOMEONE was here three years ago saying that interest-only mortgages and ARMs were bad ideas except in specialized circumstances.

[mdklatt]

Don't jump off the cliff until you know for SURE, proof positive, what your TOTAL payment will be.

Don't forget higher utility bills and the fact that if the water heater explodes in the middle of night it's your responsibility now, not the landlord's.

[jkm, the stolen pifwafwi]

Ahem.

SOMEONE was here three years ago saying that interest-only mortgages and ARMs were bad ideas except in specialized circumstances.

ahem. we've been classified under "moron" for a long time.

[olevetonahill]

ahem. we've been classified under "moron" for a long time.

All this Time I thot we wuz " Morans " :D

[Bourbon St Sooner]

I just re-financed earlier this year when rates went down and I my broker told me that FHA credit standards have really tightened up. We had to drop my wife from the load because she has some old credit problems that haven't dropped off yet. Basically, if you're not a 700 FICO score you can expect to take it in the shorts.

[soonerbrat]

No Bro the laws say UP to 7 after that It has to drop off :P

yeah, if they don't keep reopening it...like stupid effing providian. I paid their bill off back in 1998 and when trying to clean up my credit report, it STILL SAYS that I am 90 days late on $0 for however many months it has been. every time I apply for credit I have to explain it, and it's dragging my credit score down. I talked to Providian and they say I need to pay them...pay them the $0? I even sent them a copy of my credit report page and they still won't remove it.


Otherwise, I had a lot of success cleaning it all up.

[Sooner24]

yeah, if they don't keep reopening it...like stupid effing providian. I paid their bill off back in 1998 and when trying to clean up my credit report, it STILL SAYS that I am 90 days late on $0 for however many months it has been. every time I apply for credit I have to explain it, and it's dragging my credit score down. I talked to Providian and they say I need to pay them...pay them the $0? I even sent them a copy of my credit report page and they still won't remove it.


Otherwise, I had a lot of success cleaning it all up.

Write them a check for $0.00 and see what happens. :pop:

[bringit]

FHA really focuses on the past 12 months. If you are clean for the past year and have good, valid explanations for the derogatories, you should be good credit-wise. Income should be stable and consistent as well. Debt-to-income needs to be ~50% or less--up to 55% with strong, compensating factors.

[soonerbrat]

Write them a check for $0.00 and see what happens. :pop:

my bank doesn't like it when I do that.

[pergdaddy]

I can't believe anybody would do interest only or an ARM.

And if you did do interest only, that you weren't at least making some kind of principal payment on it.

When I hear it's an adjustable rate (other than credit cards), I quit listenting. I've had lendors try that with me.

[soonerbrat]

I can't believe anybody would do interest only or an ARM.

And if you did do interest only, that you weren't at least making some kind of principal payment on it.

When I hear it's an adjustable rate (other than credit cards), I quit listenting. I've had lendors try that with me.

interest only is good for people that get big bonuses and can pay large chunks at a time..but stupid for long-term

[r5TPsooner]

I can't believe anybody would do interest only or an ARM.

And if you did do interest only, that you weren't at least making some kind of principal payment on it.

When I hear it's an adjustable rate (other than credit cards), I quit listenting. I've had lendors try that with me.

I agree. I'd rent again before I did a mortgage like that.

[bringit]

I think ARMs have their place. If someone KNOWS they will not be keeping the home for, say, 3 or 4 years, why not do a 5 year ARM for a lower rate? Or like me, I have a 10-year ARM because I know I will be returning home to Texas before that time (and the rate was lower than a 30-year fixed).

[Frozen Sooner]

Ahem.

SOMEONE was here three years ago saying that interest-only mortgages and ARMs were bad ideas except in specialized circumstances.


I think ARMs have their place. If someone KNOWS they will not be keeping the home for, say, 3 or 4 years, why not do a 5 year ARM for a lower rate? Or like me, I have a 10-year ARM because I know I will be returning home to Texas before that time (and the rate was lower than a 30-year fixed).

That's what I'm saying. In certain specialized circumstances, an ARM is a good idea. Generally when you know you'll sell the place before the lock period expires or if you think that interest rates will be lower at the end of the lock period than they are when the loan is originated.

Anyone who thought that the second would be true a couple of years ago was smoking crack.

[RacerX]

Ahem.

SOMEONE was here three years ago saying that interest-only mortgages and ARMs were bad ideas except in specialized circumstances.

couldn't have been you. you've only posted for a couple of years.

there was some other jerk from Alaska on here.



:D

[olevetonahill]

couldn't have been you. you've only posted for a couple of years.

there was some other jerk from Alaska on here.



:D

Ya some frozen prick :D