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Credit Score "Zero." Do I have a chance of getting a loan?

My credit score is apparently zero. I have only one credit card and haven't used it much over the years. I don't have any negatives in my credit report, and have excellent non-traditional credit history [rent on time for 15 years, etc]. I also have 80K in the bank for a big fat down payment, stable job, and modest housing requirements.

Do I have a chance of a lender taking a chance with me? I'd be looking for a loan of about 200K.

Plan B is to have a family member co-sign on the loan. One complication there is that my father lives in France. Would a bank in the US consider a foreign national to co-sign a loan in the US?
Thanks for your help!
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March 31 2009 - Brockton
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Hi Dave,
You are asking a lot from a bank to lend you $200k with only history of your credit being one credit card with no use.  It is reflective in your credit score and shows you have not established a minimum of 3 tradelines and 1 installment to qualify for most conventional loans.

There are many first time buyer programs available and can use non-traditional credit, but you have to find and dig for these programs because they are few and hard to find these days.  Post a request on zillow with the amount you are applying for and also figure out how much you are willing to put for a down payment, and you will find some lenders who can help guide you in the right direction.
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March 31 2009
FHA all day.
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March 31 2009
davesf, you will get an FHA loan with no problem. The main lender I know charges 1 point for no score/non traditional credit. Have you looked to see what the maximum FHA loan amount is for the area you want to buy in?
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March 31 2009
You should try to establish more credit.  You will get a better FHA loan and have more options available. 
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March 31 2009
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davesf,

No debt, good job!

What has motivated you to consider purchasing after renting for 15 years?
 
Have you already applied for a mortgage? ... or actually pulled your credit report?    Make sure there are no inaccurate entries that could be negatively effecting your score. 

I wouldn't think that it would be difficult for you to find a mortgage, with your sizable down payment, as long as you have enough verifiable income to cover the mortgage payments.  As others have stated there are loan programs and tax credits for first time home buyers.  Check into them.

If you find that you can't get approval without more credit history, you may want to open an additional credit card and use both of them occasionally.  I'd suggest paying off the balances in full every month.  There is no need to run up unnecessary debt just to establish credit.   But I wouldn't dopen new accounts now if you are ready to buy, unless the extra credit history is the deal breaker...and that would take some  time to establish.


Good luck.




 
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March 31 2009
Profile picture for davesf
Thanks a lot for the helpful replies - looks like FHA is the way to go.
Any thoughts on the foreign co-signer?

@SteveH: We're considering buying now because home prices in parts of the Bay Area are insanely low, interest rates are favorable, and we're ready for a new adventure.

Cheers
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April 02 2009
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You can easily apply for FHA loan.
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June 11 2009
 
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