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First Time Buyers-Limited, but good history 737 and 796

We are looking at purchasing our first home, but have run into trouble in the past with loans because we do not have an extensive credit history (we were both still students at the time, I am now a teacher). Nothing bad; no late payments at all. I have a 737 and my husband has a 796. Will lenders look down on his score because he is the authorized user on some accounts rather than the primary account holder? Can our good history so far offset a shorter credit history? Are there other factors I should be looking into? Thanks for the help/advice.
  • April 04 2011 - US
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Answers (4)

Best Answer

Andrea,

It depends on how much you are putting down. If you are putting less than 20% down the MI companies have overlays that stipulate how many tradelines you have to have and how long they have been reported.

If you are going FHA (minimal downpayment of 3.5%)  and the FHA Total Score Card issues an accept when the LO runs his automated underwriting system then it doesn;t matter the depth of credit. The same is true on a conventional loan if the AUS accepts the credit and capacity profile of the borrower the length of credit isn't an issue.

If you have absolutely no credit at all then you'll need to have your loan manual Underwritten (This involves the lender building a credit profile through obtaining 4 tradelines with a 12 month history-rental, car insurance, utilities, cable, and phone can be used as well as any furniture or appliances purchased on installment.  If I can be of any further assistance don't hesitate to email or call.
  • April 05 2011
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You have probably done this, but look into taking a first time home buyer class.  You can usually find some perks that make it worth your while.
  • April 05 2011
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First of all, keep up the good work, students and good credit what a winning combination.

Most lenders and or banks have programs specifically designed for teachers in the way of lower rates, longer terms and so forth. Contact your local bank and credit unions.

Use your credit, by a pair of scores and pay the bill of in full. Or have you husband take you out on a dinner date, make him pay with his credit card. When the bill comes in for the dinner, pay it of in full, if you have the means that is.

You have to use your credit, "use or loose it" is what I tell my clients. The credit reporting agencies are looking for history, specifically over the last 6 months or more. If you have 3 to 4 credit cards now that is plenty. Do not apply for any more CC if you don't need them.

Best of luck!
  • April 05 2011
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Contact me through my Zillow profile, I can refer you to a great Mortgage Banker who can probably help you.
  • April 04 2011
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