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     | Tuesday, December 05, 2000 - 11:28 am  It doesn't look so good, but I'd like some feedback from the experts. First time buyer. High 600, possibly very low 700 credit. One derog ($200 paid collection) that will be about 30 mos old by then. Otherwise spotless credit history. 56k annual income. Hopefully >1 year at the same job by then. The *only* outstanding debt is an auto loan. Payoff by then will be around $14.5k, payments are $457/mo and I can sell the car and drive my beater if necessary. $6.5k in a 401k, no other savings (so sue me). Here's the problem: I will have about $5k to put down by then (if I'm lucky) with *zero* cash reserves. I'm looking at properties that are around $130k. Property values are going nuts around here (approx 10-12% app. per year) and I'd like to buy soon. I'm childfree and single (read: I'm in a higher tax bracket than someone married to an SAHM with three tax-monkeys at home) so I stand to benefit from the deductability of mortgage interest more than many people would. Do I have a chance in hell, or should I lay off the crack pipe?
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| | Tuesday, December 05, 2000 - 12:13 pm Hi, I am NO expert but I also am in the process of purchasing or trying to purchase first home. From what you have said with your credit scores you MAY be able to qualify for a loan at 100% financing, and then only would be required to pay closing cost, I have also heard of 103% financing but I don't no the qualifications of that. FHA is another route to take and they require 3% down, which on a 130K would be 3900 down plus closing costs. I don't think the collection will hurt that much being paid and almost 3 years old by then. But from what you say about your credit scores ranges in high 600's low 700's I am sure you could try for 100% financing. You may also want to search for mortgage caculators, this will tell you roughly how much you can afford and how much you will need and what your payments would be. I am sure some experts can explain many other types of programs, these are the only ones I a familiar with. Good Luck
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| | Tuesday, December 05, 2000 - 12:37 pm I've read about 100% LTV loans, and my credit might just be good enough to qualify. Trouble is, the interest rate is a bit higher and it reduces the loan amount that I would qualify for. With an income of 56k and 2/2 condos starting at 130k, I need all the help I can get! I could continue to rent for another year, but I'd have to seriously downgrade apartments. My $1510/mo apt now rents for $1630 (six months later) and may be even higher next summer when my lease is up. All the calcs I've played with indicate that I'm right on the border of qualifying. Maybe I should take a few classes and see if I can switch jobs for another 10k/yr. I work in IT, after all... One other option is to start buying jewerly for my Significant Other and convince her that she needs to buy this home with me. Her 38k would be a nice little boost although I don't know what her low to mid 600 score would do for me...
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| | Tuesday, December 05, 2000 - 05:19 pm Richard, There are several 100% programs out that do not have increase interest rates. Currently one of our products has a rate of 7.875% 60 day lock 30 Year FIX. Basic requirements: 660 middle credit score, SFR, Condo, PUD, Owner Occ. Cannot own other RE at time of Closing, 2 montsh cash reserves(not liquid OH--401k, IRA, ext.) Income restrictions: Corrower can not make more than 80% of the median income for the county. If you provide me your state and county I can give you that number. Fannie and Freddie have soem other products as well that are pretty close. Certainly no higher than 8.5% if your credit is as you say. As mentioned above there is also FHA if your just outside the box of the 100%. Based on your rent payment, your house payment shoudl be less than $1500 for a 130k home. The collection is no issue. Stop paying somebody elses mortgage and get the benefits for yourself.
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| | Tuesday, December 05, 2000 - 06:54 pm Orange County, CA. I might also consider Los Angeles County and Riverside County. 80% of the median income for the county? In other words, I need a significantly below average income? hmmm... SFR? PUD? Thanks, RM
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| | Wednesday, December 06, 2000 - 08:55 am Richard, For the counties you are looking, 80% of the median income is: LA== $41,680 Orange=$55,680 River =$37920 If you happen to be a teacher, the income limts no longer apply. To find FHA limits go to http://www.hud.gov/lenders1.html and look for mortgage limits. Tie a FHA loan with a Partners in Charity grant and you've got 100% financing. See http://www.partnersincharity.com for more info.
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| | Wednesday, December 06, 2000 - 09:05 am Are those income limits per borrower or per household?
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| | Wednesday, December 06, 2000 - 09:07 am PIC will give grants to non-minority non-childed non-poor non-disabled non-unemployed non-females? Are they out of their minds?
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| | Wednesday, December 06, 2000 - 10:22 am As i understand it is per application meaning if both husband and wife are on the loan then they count both. If just one then they only use that person's income. Not 100% sure on this though. Any yes PIC will give money to anybody
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| | Wednesday, December 06, 2000 - 12:57 pm I've been digging around on homes.com and homeadvisor.msn.com looking at condos and such. It's depressing as hell. At 135k, the pickings are slim. Now I understand why people move away.
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| | Wednesday, December 13, 2000 - 04:08 pm It looks like I'll probably need to ditch the car and its payment in order to qualify for a large enough mortgage. What a pain! The whole thing just reeks, because I'd sell the car now, get the mortgage, move into my new home, and then immediately buy another new car with the same payment that I had on the last one. It actually *increases* the mortgage lender's risk, since I'm not upside down on this car (I could sell it cleanly in the event of a hardship) yet with a new car I'd be stuck for a year or two. I don't *want* a new car... I want *this* one. It's a nearly flawless 29k miles Toyota that's about 1/3 paid off. Are lenders willing to do anything creative in situations like these? Will they somehow take into account that I have a $16,000 car to show for my $16,000 debt and make some sort of concession? An alternative would be to find a loan-shark (or maybe my parents would help) to "purchase" the debt from my credit union thereby getting it off my credit history. I could secure used-car financing later on. This is bullsh*t...
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| | Wednesday, December 13, 2000 - 04:57 pm Richard, I still think you can make it work without giving up the car. At least you should give it a shot. Add the signif. other for her income. Go FHA, her low 600 score mean nothing as FHA DOES NOT credit score. The fact that your paying the same amount of house payment that you woudl pay if you owned in a big comp. factor. FHA will allow ratios of 29/41 although higher ones have been done. Up to about 45.. How much are the condo fees and taxes? Any other bills? Credit cards. Waht are the sig. others bills? Let's work the numbers and see.
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| | Wednesday, December 13, 2000 - 06:52 pm I don't know about condo fees since I haven't officially started shopping yet. I'm waiting for the last little bit of revolving debt to get beaten down to zero. I'm hoping to be able to save up a little bit of a down payment, too. My current lease is up 6/1/01. Once that happens, my monthly debt payments will be ZERO other than the aforementioned car payment. I'm wondering if it would be wise to start revolving again (at 9.9%) and begin saving for closing costs instead. Being debt-free won't mean much if I'm penniless. The stability of my relationship with the SO is a little too questionable for me to be too enthusiastic about adding her on, otherwise I'd do it in a heartbeat.
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| | Thursday, December 14, 2000 - 04:20 pm I would pay off the debt. Don't start new accounts and no need to add to existing. You probably need $1k-1.5K for some closing cost but you can get away with a no down deal so I wouldn't worry to much. If your serious about buying, cut out the extra's in your life that you don't need for the next six month. Cut down on the dinners out with the SO, spontanious purchases, and other things. Gotta budget.
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