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Can I get a conventional loan with a 620 credit score? If not please explaine`

  • March 02 2010 - Baton Rouge
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Answers (8)

Profile picture for caledonian2010
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  • March 03 2010
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Not with my company. 620 qualifies for an FHA but the good thing with this is that your are backed by the government and with FHA, credit ratings are looked at with less scrutiny. Letters of Explanation work wonders here :)...even if it is simply because you haven't had a long history of credit.
  • March 03 2010
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There is no mortgageinsurance on a GRH loan...
  • March 03 2010
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Profile picture for Texas Banker
At 620 you will not be able to get mortgage insurance.

Putting 20% down the score adjustments are significant, you migth be better off with FHA.
  • March 03 2010
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Sam,

The score is just part of the equation (and the one you mentioned is not a good part for FNMA presently). FNMA's DU simply looks at the entire loan package and issues an approval or denial in some cases. The pricing as stated below (penalizing that score) is like what LSU did to OSU in the BCS game a couple years ago (a beating).  After the meltdown, FNMA instilled penalty pricing on almost all categories below a 740 score depending on loan purpose, score and LTV.  Geaux Tigers.  (class of '87)  :)
  • March 03 2010
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As Michael stated, you may want to look into a USDA or Guaranteed Rural Housing loan. The Up Front Mortgage Insurance fee of 2% is higher than the current FHA UFMIP of 1.75% but there is no mortgage insurance. They will also allow you to finance some or all of the closing costs up to 102% of the properties value including the UFMIP. You will need to verify that the home is located in a "fundable" area by GRH. You can verify that here->   http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=sfp&NavKey=property@11

Hope this helps!
  • March 03 2010
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Depending on the the specifice address you may get USDA coverage, no mortgage insurance and rates better then true conventional.  USDA will allow you to go to 100% financing with that score. 

Let me know if that helps.
  • March 03 2010
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It depends on the loan-to-value.  If the LTV is 80% or less you can qualify.  If it's greater than, you will have to look at a different option.  Just a heads up...there will be a big hit to pricing for the credit score.  You may get a better deal with an FHA loan.
  • March 03 2010
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