Posted on: 14th Sep, 2010 01:20 am
My father and I have always dreamed of purchasing a home. He is retired and has limited income but has an excellent credit score. I make about $2,400 a month and have little debt but my credit score is not great. I am currently in the 620's. Would we be able to qualify for a loan to purchase a home?
Hi sarai,
As you have a stable income and a credit score of 620, you can apply for a FHA loan. Your father can cosign for the mortgage. With his good credit score, you will be able to get better interest rates when you take out the loan. However, please note that mortgage insurance premiums on FHA loans will increase from 4th of October, 2010 (check out: http://www.mortgagefit.com/news/fha-insuranceprograms.html ) . So you should immediately contact the local FHA lenders and apply for a mortgage.
Take care
As you have a stable income and a credit score of 620, you can apply for a FHA loan. Your father can cosign for the mortgage. With his good credit score, you will be able to get better interest rates when you take out the loan. However, please note that mortgage insurance premiums on FHA loans will increase from 4th of October, 2010 (check out: http://www.mortgagefit.com/news/fha-insuranceprograms.html ) . So you should immediately contact the local FHA lenders and apply for a mortgage.
Take care
The 4 major factors in getting a mortgage is your credit score (which in this case is good enough), Employment history (lenders usually require 2 years), Income (For DTI purposes) and assets(for down payment and reserves). What is your combined income annually and what price range are you looking in?
Thanks Sara for the information. That was very useful.
Tfaulhaber1 - my annual income would be around 28,800 . My dad's, I would calculate, is around 11,000. (like I said before.. he is retired). I have been working with the same company for the past 10 years. My major debt is my students loans which are on forbearance right now because I am still in school. We don't want to go above $160,000 on a house. Please advice.
Thank you
Tfaulhaber1 - my annual income would be around 28,800 . My dad's, I would calculate, is around 11,000. (like I said before.. he is retired). I have been working with the same company for the past 10 years. My major debt is my students loans which are on forbearance right now because I am still in school. We don't want to go above $160,000 on a house. Please advice.
Thank you
Thanks Sara for the information. That was very useful.
Tfaulhaber1 - my annual income would be around 28,800 . My dad's, I would calculate, is around 11,000. (like I said before.. he is retired). I have been working with the same company for the past 10 years. My major debt is my students loans which are on forbearance right now because I am still in school. We don't want to go above $160,000 on a house. Please advice.
Thank you
Tfaulhaber1 - my annual income would be around 28,800 . My dad's, I would calculate, is around 11,000. (like I said before.. he is retired). I have been working with the same company for the past 10 years. My major debt is my students loans which are on forbearance right now because I am still in school. We don't want to go above $160,000 on a house. Please advice.
Thank you
What would be the pros and cons of obtaining an FHA vs a conventional loan?
Hi sarai,
FHA loans are available at a low credit score and low down payment compared to a conventional mortgage. If you don't have the required credit score and down payment for a conventional loan, you can go for a FHA loan to buy a property.
Thanks,
Jerry
FHA loans are available at a low credit score and low down payment compared to a conventional mortgage. If you don't have the required credit score and down payment for a conventional loan, you can go for a FHA loan to buy a property.
Thanks,
Jerry
Most conventional loans require a 620 + score and a minimum of 5-10% down. FHA allows as low as a 550 credit score. At your score, they would require 3.5% down. With the income you currently have, $160K is shooting on the high side. You might want a loan officer to run your credits and pre approve you for the maximum amount of mortgage you can afford.
Most conventional loans require a 620 + score and a minimum of 5-10% down. FHA allows as low as a 550 credit score. At your score, they would require 3.5% down. With the income you currently have, $160K is shooting on the high side. You might want a loan officer to run your credits and pre approve you for the maximum amount of mortgage you can afford.
"Most conventional loans require a 620 + score and a minimum of 5-10% down. FHA allows as low as a 550 credit score. At your score, they would require 3.5% down. With the income you currently have, $160K is shooting on the high side. You might want a loan officer to run your credits and pre approve you for the maximum amount of mortgage you can afford."
If that is the true case, why doesn't everyone get an FHA loan instead of conventional, there has to be a catch here. Higher fees and rates perhaps?
If that is the true case, why doesn't everyone get an FHA loan instead of conventional, there has to be a catch here. Higher fees and rates perhaps?
Most conventional loans require a 620 + score and a minimum of 5-10% down. FHA allows as low as a 550 credit score. At your score, they would require 3.5% down. With the income you currently have, $160K is shooting on the high side. You might want a loan officer to run your credits and pre approve you for the maximum amount of mortgage you can afford.
If the above statement is true, then why doesn't everyone acquire an FHA over conventional? There has to be a catch, higher fees and rates perhaps?
Or is it just to avoid PMI?
Or is it just to avoid PMI?
FHA has an Up Front Mortgage Insurance Premium that's added to the loan but, besides that it's usually to avoid PMI. If you have 20% to put down, I would suggest going conventional over FHA. FHA guidelines allow less of a down payment, gifts, non-occupying co-borrowers. If you're in that type of situation then you take the FHA route. If you have excellent credit and lots of assets, you would take the conventional route.
What range should I be aiming for? I am married but my husband owns an apartment that is going under foreclosure right now. We can afford the 160K but I know it wont be approved because I could only report my income and my fathers.