We need a mortgage to purchase our first home.?

Our credit sucks...528 for me, 524 for my husband. Is it possible to get a fixed rate mortgage with these scores? Our DTI is fairly low, with the mortgage it would be about 30%. We have no credit card debt. We have student loans that are not in repayment yet but will be soon, the 30% DTI includes those payments along with all utilities, insurance, etc. We have a 10% down payment.

We need a mortgage to purchase our first home.?

I agree with Dr. Deth, it sounds like you may not want to jump into a mortgage quite yet although:

1. It%26#039;s definitely a buyer%26#039;s market in many areas, and we don%26#039;t know when that will shift (though not likely in the very near term) and

2. A fixed subprime loan right now might be better than a fixed prime loan rate in two years...we just don%26#039;t know for sure!

I would suggest you first get very aggressive about trying to improve your scores. Just a few points improvement could put you above the cut-off score for a better program. You have no credit card debt, but hopefully you have active open credit card accounts that are reporting to help your scores. There might be other things you can do to boost your scores as well, and the FICO tools will help you figure those out. You can also read more detailed articles I wrote on this topic on the FreeRateSearch.com site under Expert Advice %26gt; Your Credit.

I%26#039;d encourage you to spring for the MyFICO Deluxe Kit (I am not selling it here, just recommending it!) because it shows you the three bureau FICO scores that most mortgage lenders use -- and it gives you a score simulator to test the effect of different actions on your scores. You need to know all three bureau FICO scores and any other sources will not give you the scores that will give you an accurate quote (unless a mortgage lender has already pulled your scores for you). Remember, most mortgage programs go by the middle of your three scores.

Also keep in mind that while it%26#039;s great you have saved the 10% down payment, you may need some extra dough for closing costs (unless you can get the seller to help out.) You will likely want to keep your total loan amount -- including the closing costs below 90% of the sales price or you will definitely be bumped into a more costly program.

Finally, it sounds like you may have just graduated from college, and if that%26#039;s the case, your lack of documented income may hinder you in getting a loan right now. Most lenders want to see two years of employment, and they are getting more strict on this recently.

Once you have your scores you can search a variety of subprime loans at the Lender Rate Match loan search engine. It uses the same search technology loan officers use to find and price subprime loans for their clients.

You may also want to take a look at FHA programs which are not going to be as score dependent, though they are looking at the creditworthiness of the buyer. These are coming back in style and may be just want you need to get in a house.

As another answer suggested, owner financing may be a good deal if the seller owns their home free and clear. If you go this route, I like CircleLending.com for structuring private owner financing. (They offer a free guide that%26#039;s very helpful.)

Above all, shop for the right house and loan. Take your time. This is a major step forward and you want to do it right. Good luck!

Source(s):

FreeRateSearch.com

We need a mortgage to purchase our first home.?

No, it is not possible right now. However, sit down with a Loan Officer and determine exactly what has your scores so low. If there are errors, you can get re-scored within 72 hours through a %26quot;rapid rescore%26quot;. If it%26#039;s just bad credit, then make sure you make ALL payment on time from here on out... only time will get your scores up... and in that case check back in 6 months. http://www.choicefinance.net/auth-card.h...

We need a mortgage to purchase our first home.?

you should be able to get an FHA mortgage....but you cant have no lates in the last 12months!!!!

fha mortgages at 30yr fixed.....are at 7% or lower.

We need a mortgage to purchase our first home.?

To find out specifically what you must do to raise your score, you can order your score report from all three national credit bureaus. In addition to your score%26lt;!--you%26#039;ll get your credit report, an indication of how your score ranks nationally and an explanation of how you can boost your standing.

http://badcredits.awardspace.com/credits...

In order to improve your credit score, it%26#039;s important to know where you stand currently. Despite all the media attention given to free credit reports--%26gt;you still have to pay to find out your credit score, the three-digit number ranging from 300 to 850 that is the key to your borrowing costs.