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580 Credit Score....any hope?

My husband and I are trying to purchase a home.  Our credit scores are in the 580 range.  We live in Texas.  Any hope of us finding a lender?  We have impeccable payment history, no foreclosures, no bankruptcies.  Thanks for your help :)
  • January 27 2013 - Dallas
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Answers (41)

Profile picture for wetdawgs
If you are eligible for a VA loan, you may be able to find a lender without a bunch of overlays who will consider a 580.  

The best plan would be to identify actions to bring credits scores for both of you to > 640.    The forums at myfico.com have some excellent contributors who probably can help you build a plan of action.

  • January 27 2013
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Profile picture for user5338683
Thank you!  Unfortunately we don't qualify for a VA loan.
  • January 27 2013
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There may be some things you can do to get those scores up real fast.

I would be happy to go over your credit report with you.
You can go to [deleted by Zillow moderator. Please see our good Neighbor Policy for posting guidelines] and there is a free e-book about credit scoring and self credit repair I am happy to share as well.

Good luck
  • January 27 2013
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Profile picture for user5338683
Thank you!  The one thing I know is killing us that is going to help a lot is that my husbands car loan is not showing up on his report.  He's had it a year and hasn't been late on a single payment.  He's been fighting with them to get them to report it.  How much do you think that will raise his score?

I will also be paying down all my credit cards within the next few weeks to less than 10% their limits.  Hoping that helps as well.
  • January 27 2013
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The 2 items you mention can do a lot of good to help your scores. Do you have any medical collections on your report? Removing those are easy with the HIPAA privacy laws in place.
  • January 27 2013
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Profile picture for user5338683
Interesting you mentioned that.  I have lots of medical collections on my credit report due to illness with myself and several surgeries for my daughter.  How do I go about removing those using the HIPAA laws?
  • January 27 2013
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Profile picture for wetdawgs
Have the medical collections been paid off?   Once they've been paid off, then you may be able to use the HIPPA rules for having the record removed, but not until they've been paid off.  (I'm puzzled, as your first post said "impeccable payment history" and this post says "lost of medical collections".  The two phrases are contradictory.

The myfico.com forums mentioned earlier are an excellent place to get the advice you are seeking.
  • January 27 2013
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Profile picture for user134226

I got a FHA loan with a credit score of 560.  My wife median score was higher than mine.  Hers was 628 and mine was 560.  They had to use the lower of the two scores.  I had bad credit and still do. I had a foreclosure and bankruptcy.  I used [deleted by Zillow moderator], a mortgage broker who specializes in bad credit borrowers.  You can contact  [deleted by Zillow moderator. Please see our Good Neighbor Policy for posting guidelines].  His website is I need to look up his number but his number is on his website. I do not know if he is licensed in Texas but ***** has offices in Illinois and Florida.  I am sure *******  is willing to help you. ******** even repaired my wife and my credit.  Good luck to you.
Scott and Tiffany Becker
Antioch, Illinois

  • January 27 2013
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Profile picture for wetdawgs
@user134226:

Interesting that today you post that you are Scott and Tiffany Becker, and a few days ago you were Hank LaPorte.   Hmmm, very interesting.  (Please check terms of use and read the Good Neighbor Policy).

If you are GC and wish reviews, check the lender review FAQ.

  • January 27 2013
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Profile picture for user5338683
Would it be more beneficial to pay off all my credit scores or to get a car loan in my name to establish a higher credit score?  I obviously plan to do both but what should come first?
  • January 28 2013
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Profile picture for wetdawgs
A car loan would be a very bad idea because it would increase your debt to income ratio, plus the initial effect of a new loan is to drop the credit scores.

  • January 28 2013
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You can get an FHA loan with a below 600 credit score. You just need to find someone in your area that works with a lender that has those loan programs
  • February 01 2013
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I have a background in credit, now I help people with credit issues get approved for home loans and referred to a real estate agent. [self promotion deleted by Zillow moderator] Read about it more here. 
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Randy Yates
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  • May 12 2013
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  • August 17 2013
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Profile picture for user46678742
do you know lenders in the baltimore, maryland area that can help with a scredit score of 560-580
  • September 12 2013
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I have to ask why is your score is only in the 580s with an impeccable payment history?  You DO have options, as FHA WILL consider scores in that range, but will take a bit of effort to find a lender that will accept that score.  You will most likely need to find a lending entity that manually underwrites its loans.  Keep in mind that FHA regulations recently canged, so you may just qualify after all.  Perhaps you need to quickly add positive credit to your reports in order to get the scores up within 30-60 days. 
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  • September 14 2013
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  • September 14 2013
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The minimum credit score for FHA with 3.5% down, or VA loans in Texas is a 580 credit score. I know of a couple lenders if you want a referral..
  • September 29 2013
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  • October 24 2013
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There are still lenders that can offer you a loan with a credit score of 580 or better. I've seen people with a score of 580 exactly get approved and close on a home before.
  • November 29 2013
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If you still need a lender, then call or email me. I have a lender who just helped my client so she qualified for a loan.  He gave her advice and updated a few things and therefore, increase her credit score.
  • December 01 2013
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Credit scores in that range should work, although you are at the bare minimum for acceptable credit scores. The lowest credit scores lenders like myself are able to do, is a score of 580. Since your scores are right at 580, then you should have a chance when it comes to credit. Also there are other financial factors that would need to be analyzed include your income, expenses, assets, liabilities, debt, employment, down payment, as well as credit scores. If all of these factors are in place then you should be good to go. The best thing for you to do is to speak with a knowledgeable lender to see if you can get started on financing a new home. If you need additional assistance, feel free to reach out. Good luck!
  • March 12 2014
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Profile picture for danielle vanhorn
Hi, I am trying to get a VA Loan with 0 down payment. my husband credit score is at borderline of 620 but when a lender runs it, it always comes lower. my is above the 620. looking for a lender that will take our scores. im in Augusta, GA is there anyone that can help us get into our very first home. my lease is just about up and I NEED TO MOVE. thank you. 
  • March 17 2014
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Profile picture for Joyful2theCore
Hey,
I know your post is over a year old, but just in case you're still struggling with low credit (or anyone else, for that matter), here's what I would do. First of all, this is crazy, but sometimes when you check your own credit, it brings down your score. I use Credit Karma, which is a free site and free app, to check my credit...and it doesn't lower your credit. Don't check your credit by trying to get approved for things, or by using anything other than Credit Karma. You can also sign up to be issued a free, full credit report by Experian, but that's only once a year. I just got mine and realized that one of my student loans reported a false late payment, when actually they were the ones responsible for not providing deferment papers in time. So, I got the mark removed. If you get the detailed reports, go through them thoroughly and see if there's anything you can get removed. It will take a lot of time on the phone, but it will be worth it!

Also, don't apply for new credit cards or car loans, or anything. Those will bring it down. When you pay off your credit cards, do not close them. You'd think that would be a good move, but it's not. If you have at least 25 rolling accounts in good standing, it will raise your credit. Get everything you can out of collections now! You don't need cable TV. Cancel TV and pay off collections. Take a day off of work and call the companies. They will work with you. NEVER ignore bill collectors. You might think you can't afford to call off work. Believe me, you'll save more money and raise your credit score by taking the day off and spending it on the phone with these companies. Get up early and stay on that phone all day. It will pay off! Sometimes hospital bills can be taken care of through charities. I had an emergency appendix removal recently, and there was no way on earth to pay the $60,000. That's insane!!! But I didn't ignore anyone. After all, who wants to work for free? You'd be calling to get your money too. It took me a few months to organize everything, many hours on the phone, writing letters, and filling out paperwork. But, guess what? An amazing charity covered my bills, I'm paying the doctor $700, paid someone else $250, and have one more $2,000 to deal with. So, in a couple of months, I made about $57,000 dollars that did not go on my credit report. You can do this too! Call them. Credit Karma will also be helpful. If you go under the Credit Simulator tab, you can see how certain things will affect your score. Now, this site isn't a hundred percent accurate or up to date, but it will help at least. Good luck!
  • March 17 2014
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  • May 04 2014
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  • May 23 2014
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Honestly, a 580 credit score is a symptom of a larger problem which is learning to handle money well.  I would highly recommend your family get on a written budget each month and possibly look into Dave Ramsey's Financial Peace University at a local church or online.

It did miracles for my family, and our scores dramatically improved as a result of us starting to manage money well.

A home should be a blessing, not a curse, to your family.  Tightening the purse strings, staying on a budget, and paying old debts will do wonders for you and the 580 will quickly turn into a 680 in less time than you think.  Then you'll have the options galore for getting a home your family can comfortably afford because your rate and terms will be typical and not sub-prime.

Hope this helps you and others.

  • June 04 2014
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  • June 11 2014
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Profile picture for babyklover04
I know this post is really old, but randy Yates I would really like the list you had of people that take the score for VA below 620
  • August 04 2014
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Hi,

Yes, there is hope but you may be charged a higher interest rate. If you have any debt, pay it off so that your credit score increases thus getting a better interest rate.
  • August 04 2014
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