Will I be rejected with a 697 fico?

Posted on: 24th May, 2009 08:04 pm

I have worked hard to repair my credit. I was able to remove all but 3 baddies. I went from a 509 middle to a 697 middle. I have had the same job for 11 years, now making 73K a year. My wife has a 780 middle score, and makes 30K a year. I have had no lates for the past 7 years and I carry 1K in credit debt. I have 2 cars with no lates and my debt to income ratio is well under what is average. I was asked by the underwriter for a letter of explination for the 2 Midland and 1 Applied bank balances not paid and in collections. I'm sending a well worded letter for each, and I hope that is sufficient.

My question is:
Am I going to get rejected or do I have a chance for this mortgage? We are doing FHA with 3.5% down on a 241K loan.

Thanks to anyone who can help with an answer.

Total Reply : 7

Hi fyr,

To qualify for an FHA loan a credit score of 620 is required. Your credit score of 697 is good enough to qualify for a loan. Eleven years of work history will also work in your favor. You do not have any late payments for the past 7 years which is also a positive point for you. Everything apart from the three negatives on your credit looks good enough for you to get the loan. If you can explain the reason for those three negatives on your credit and convince the lender that you will take necessary steps to remove them from your credit, they may consider offering you the loan.

jenkin7

Posted on: 24th May, 2009 10:42 pm

You are in good shape. Would love to know more about your liquid assets. FHA may not be the best loan for YOU....especially if you can put more than 3.5% down.

eric1

Posted on: 25th May, 2009 11:52 am

I have 10K on hand and 8K in retirement. I had more in retirement, but we all know how that goes. The seller agreed to 5K in closing costs and buying down our points. The house is 241K, we will be financing 232K.

fyr196

Posted on: 25th May, 2009 02:54 pm

You shoudl nto have any trouble in gettign a FHA loan.

But remmeber you will be paying PMI (MIP) when you make less then 20% down payment. Also there is a 1.75% upfront MIP with FHA loans.

So your monthly payments will be higher until you pay off 20% of the principal.

Realgeni

Posted on: 25th May, 2009 07:27 pm

From what has been listed above you seem to qualify. However, you have to decide if you're comfortable with your savings being drawn down that low and little remaining assets after all is said and done. I hope this helps...