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I have a fico of 574 and am trying to find an fha lender.

My work history, rental history and debt to income ratio is excellent. My credit is just shabby from a divorce and being laid off once a few years ago. My mother can cosign.. but her credit is only 660 and her debt/income ratio isn't great. I can more than afford to buy the home I want. I'm just stuck and really do not want to spend another year renting.
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July 29 2013 - Springfield
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I need at least a 580 score, the last 12 months of verifiably rental history (no money orders, or cash payments) and I can more than likely get you qualified on your own. We have to look at credit though and see what can be fixed to boost you over the 580 mark.
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January 03
Kamron FHA allows for borrowers with scores as low as 500 to qualify. We have offered programs like these for years. Now the difference between having a 500 or a 580 score will be the amount of down payment you are required to bring in. Also please note that starting 2014 borrowers with scores under 620 and debt to income ratios are over 43% will now be required to pass manual underwritting. This only means that you will need to have compensating factors. I will be happy to explain what all this means in further detail if and when you are ready to be pre-qualified.
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November 26 2013
Just a reminder to folks who run across this blog and see the discussion regarding minimum FICO requirements for buying a home.

We have lenders that will go down to as low as 530 FICO.  It will depend on the makeup of your credit and why your score is so low.  Be prepared to document 12 or more months rent when you have a FICO below 620 (sometimes you can get away with no rental history).  the rate will adjust up from market rate due to low FICO, but it is still a very reasonable rate.

We also have a great lender who will honor FHA and allow a 580 minimum FICO with a great rate (today 4.25% with a nice closing cost credit). 

If you are in the state of Washington and need help, don't hesitate to call me at 206-890-twelvehundred (1200).
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September 23 2013
I know a mortgage broker who is a FICO certified credit expert and does credit work for free as long as you do a loan through him. He can do an FHA loan down to a 620, but he'll guide you on how to get there QUICKLY, not a year from now. Message me & I'll give you his info.
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August 19 2013
If you have 10% down then you have a chance of getting approved.
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August 17 2013
Kamron, sorry to hear about your credit situation. Sounds like your credit is one of the main casualties of your divorce and unemployment. Many people have been in your situation; dont despair, there are things you can do to improve your credit report and score in a relatively short period of time for little or no cost.

 First you want to get a copy of your credit report from all three bureaus. you can go to the government run site, www. annualcreditreport.com and get a free copy of your credit report from all three bureaus once per year. I suggest you do this to see exactly what the damage is, if you have not already done so. Knowing is really half the battle! there is also a website called www.creditkarma.com, that you can get your trans union credit report and score from totally for free. the score they offer is not necessarily the core that we lenders use, but its a good start. No catches, no credit card required, and no enrollment in a monthly monitoring program. It even allows you to track you score over time. Its a pretty cool website, considering the cost is zero.

It can actually be easier to improve your credit than find an fha lender that will lend to you with favorable terms using a 574 credit score. Improving your score first will open up the door to more options, better rates, and lower costs. Many credit reports contain errors, even in a situation such as yours. So, after reviewing your report(s), I would dispute any delinquent account that may appear to be inaccurate. you would be surprised to see what you can accomplish just by requesting an investigation of derogatory items on your credit report. often times these entries are incorrect and will be deleted, or an incorrect pay history will be updated removing late payments that should not appear. this is no guarantee, but it is a great place to start, and it costs nothing. credit reporting by no means is an exact science!

I work with an fha lender that will go down to a 620 score and still offer very good rates and little or no adjusted origination fees, compared to a lender that will offer you a loan with a sub 620 or sub 600 credit score. you dont want to be stuck paying a point or two above market rates just because your score is lower than it should be. But, by the same token, you need to demonstrate to the lender that you are a good risk. Having a credit score of 574 is indicative of numerous derogatory items on your report. Over time negative items will hurt your score less and less, but there other things you can do now to improve your score in a relatively short period of time, say 30 to 60 days, or less. I am not going to go into all of them in this post :), but I will say the more available credit you have, the higher your score will be. A secured credit card with a $300-$500 limit can have a dramatic positive impact on your score. many bans, credit card companies, and credit unions offer these types of cars, and the yearly fee can be as little as $30 a year. Also, the money money you put up as security earns interest. So if you an extra few hundred dollars, you  can really put your money to work for you!

If you have outstanding collections, you can often negotiate the settlement of these accounts for pennies on the dollar. If you were recently or not so recently divorced, your MSA (marital settlement agreement) will state who has to pay for what, when it comes to joint debt. This will not nullify or supersede your agreements with your creditors, but it can be a good jumping off point in determining what accounts to tackle/settle first. I recently helped a friend turn $9600 of credit card debt into $2600. i have done this for clients in the past as well, all free of charge. That's about .27 cents on the dollar. The same lender I mentioned before, now ignores medical collections, so this can free up capital to negotiate other accounts if necessary.

Last, adding a cosigner is not a cure all for having a low fico score. When we have 2 borrowers on a loan, we always use the lower of the 2 middle scores, assuming each borrower has 3 credit scores. So even if you added your mother to the loan, your score would still be used as the score for the loan, putting you right back where you started.

 Time is on your side, its just a matter of how much time. In my opinion, rates and home prices will stay low long enough for you to improve your score so that you don't need a cosigner and you can still get a favorable rate and a nice home at a decent price. I have worked with many people in your situation over the last 15 years, and everyone I helped who wanted to buy a home, was able to in a relatively short period of time. This is the path of least resistance in my opinion. Feel free to post additional questions and concerns. Many of the lenders on here are generous with their time and knowledge. The more we know, the more help we can offer. - joe
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July 29 2013
Minimum credit score requirements for FHA home loans depend on which FHA loan product the applicant needs. Generally speaking, to get maximum financing on typical new home purchases, applicants should have a credit score of 580 or better. Those with credit scores between 500 and 579 are, according the the FHA guidelines, "limited to 90 percent LTV".

Applicants who have a minimum decision credit score of less than 500 are not eligible for FHA mortgages.
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July 29 2013

You'll probably need at least a 620 to be about to get a home loan.  Have you had a loan officer pull your credit recently to see if you might be able to boost your score quickly by completing a rapid rescore?  You don't have very far to go.

Feel free to contact me if you'd like me to take a look.

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July 29 2013
 
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I have a fico of 574 and am trying to find an fha lender.
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