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mortgage ?

Melanie8284Melanie8284
in Buying A Home
we currently own our house with no mortgage on it. We met with a mortgage lender tonight to take out mortgage on this house with cash out that we will use to purchase another home.  Due to some medical bills our credit scores are really low. Our lender told us they can't proceed with mortgage process until our score is at least 640.  Is this a common thing, or is it just this company that won't do it with scores lower than that?
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Re: mortgage ?

  • sd2phxsd2phx

    Not wanting to lend to someone with a low score doesn't seem that unreasonable.

     I'm confused though... why would you take out a mortgage on your existing home in order to buy a new home?  Why not just look at a mortgage on the new home itself? 

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  • Melanie8284Melanie8284
    We take out a mortgage on our current home so we can pay cash for the new one and don't have to go through all the inspections and all that since the house we have our eye on is a foreclosure.
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  • Jen&Jeff06Jen&Jeff06
    Common. My company sells our loans after close, and we deal with BOA, GMAC, WF, and Chase. I believe GMAC will allow you a 620 Fico on a conventional loan. All other investors require 640, whether it is conventional, FHA, or VA.
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  • ArcadianDreamsArcadianDreams member
    2500 Comments Fourth Anniversary
    Very common. Also, they may or may not want to come out and do an inspection/appraisal on your current home.
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  • Amberley18Amberley18 member
    5000 Comments Fourth Anniversary 5 Love Its Combo Breaker
    imageMelanie8284:
    We take out a mortgage on our current home so we can pay cash for the new one and don't have to go through all the inspections and all that since the house we have our eye on is a foreclosure.
    Inspections and appraisals are designed to help you as well as the lender. I would consider having them done regardless of whether or not they are required. You want to know what you're getting into, ESPECIALLY with a foreclosure.
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  • Desmond&MollyJones*Desmond&MollyJones*
    Very common.  We ran in to a similar situation, but it ended up working out.  GL!
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  • SisugalSisugal member
    Eighth Anniversary 10000 Comments 100 Love Its Combo Breaker
    That is a mighty low FICO score.  There are minimum lending standards - you are below the minimum. If you were to find a lender that will give you a loan, you will pay a higher than normal interest rate.  Were you not making monthly payments on your medical bills?
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