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650 middle, $66k income, 9% debt to income ratio. Can I qualify, with a recent layoff?

I had some credit problems while in school, but haven't had a late payment in over 5 years. No open lines of revolving credit and no desire to get one.  I was looking at qualifying 2 years ago and was told to wait for my credit score to improve.  I was laid-off 17 months ago and out of work for 5 months.  No late payments during my lay-off.  4 years at my previous employer and 1 at my current, both in the same line of work. Current position required relocation.    Looking to spend $60-80k.  $20k down.  My main worry is the 5 months without employment. Am I stuck in limbo for another year?
  • June 22 2012 - Cincinnati
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Answers (2)

If you don't want to go with a 15 year mortgage, ask your loan officer the cost to buy your rate down to that of someone with a 740 or better credit score. I would then ask your seller to pay a seller concession in that amount.
  • June 24 2012
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You should be OK. You returned to same field and layoffs are acceptable reasons for employment gaps. I would suggest you plan on 20% down, apply for a conventional Fannie Mae loan and also a 15 year term. On the 15 year you won't be penalized for your FICO score and would get the same rates as a 800 FICO buyer. Payment should be a breeze since your debt ratio is so low.
  • June 23 2012
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