Buying A Home
germswif E
member
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
buying a home with not so good credit
Hello.
I am new to the board with a few questions.
My credit is in the low 600's mostly because of medical bills and a student loan I pay on time. I have 10k for a down payment but I'm afraid I'll still get rejected. Any suggestions? What are some things I can do to improve my score?
TIA!
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Re: buying a home with not so good credit
Add to that downpayment so it = 20% AND have a well established emergency savings fund of 6 months expenses and you will fare better. Continue to pay on time and pay down consumer debt - especially credit cards. Best to pay them off and then pay them off monthly after any use. Your debt to income ratio plays into the interest rate for which you qualify as well as your FICO score. Less debt will also increase your FICO.
Limit your purchase price to no more than 25-28% of your TAKEHOME pay - (mortgage+PMI+insurance+taxes+HOA+utilities). 30-35% if you live in a HCOL area.
Wait until you are financially ready and continue paying on time.
Just because she has student loans does not mean she isn't finically ready to buy a house.
You will qualify for a mortgage but often with a lower credit score you will have to pay a higher then prime rate. Fwiw I have student loans debt and we bought both our first and now second homes just in my husbands name. This also eliminated my income to be used but we prefer to buy on one income.
No, but just because she pays them on time doesn't mean she is financially ready for a house.
You do not get a credit score of 600 with any kind of bill --- you have to not pay it on time, or not pay it, have too much debt over all, use too much of your allowable cc limits, made late payments or have defaults on your history.
You want to keep your cc useage at no more than 15% of your allowable limit to increase your FICO score.
Please don't use a builder for help to repair your credit. They are hardly a neutral and unbiased party. They will "help" get your credit to where it is just good enough to qualify for a mortgage at a bank they are affiliated with.