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Answers (8)
- Pasadenan
- Contributions:21466
At 4.5% fixed annual interest rate borrowing 96.5%.. that would be about $14.67k per year, which is only 29.3% of $50k.
So, if there is no other outstanding debt, it makes no sense to increase the interest rate by intentionally lowering middle FICO score just to have more qualifying income on the application.
But, as the existing debt to income ratio was not mentioned, there really isn't sufficient info to say.
Besides, 700+ FICO is not what I would call "excellent". On ZMM, the FICO score should be 740+ for the better rates, and I've often heard that 760+ could get you better rates. And I personally don't consider anyone's FICO score to be "excellent" if it is not above 800.
So, if there is no other outstanding debt, it makes no sense to increase the interest rate by intentionally lowering middle FICO score just to have more qualifying income on the application.
But, as the existing debt to income ratio was not mentioned, there really isn't sufficient info to say.
Besides, 700+ FICO is not what I would call "excellent". On ZMM, the FICO score should be 740+ for the better rates, and I've often heard that 760+ could get you better rates. And I personally don't consider anyone's FICO score to be "excellent" if it is not above 800.
- Sheree Landerman, "The Buyers Rep"
- Contributions:11
This is defintiely a question for a great mortgage originator. Currently FHA minimum downpayment is 3.5%. The lenders that I have my clients work with hdo actively help/assist clients with making smart moves to modify and improve their credit scores.Depending on what area you are in, if you do not have an agent, contact me directly and I can refer you to an appropriate lender for your situation.Don't sit back and wait, be proactive, it may not take as long as you think to make the adjustments.
- Shawn Ryan Rosa, "sryan1980"
- Contributions:493
FHA downpayment is a minimum of 3.5% - not 3.0 - 3.5% - factor that into your calculations.
you'll also have to pay monthly PMI and an upfront FHA premium.
you'll also have to pay monthly PMI and an upfront FHA premium.
- sunnyview
- Contributions:25139
I think that the lenders will look at your whole package, but will probably go off the lowest middle score between you and your girlfriend. I would get a copy of your current score and see where you stand. You may need a higher down from what I read if your score is lower, but a good lender could preview your numbers and give you some idea of what to expect.
- Matthew Dorsey, "Matt Dorsey"
- Contributions:30
It may have a negative effect so you might be better off doing everything in your girlfriends name, however check with a mortgage professional who can look each of yours credit and let you know your options.
- Drew Ludlow, "DrewLudlow"
- Contributions:505
There is a national bank that will go down to a credit score of 600. PM me for the name. By process of elimination, though, there aren't too many BIG banks any longer that just completed a merger with another national bank.
- Cynthia White, "palmbayrealtor"
- Contributions:23
Lenders require a min credit score no matter how much money you bring to the table. I know some lenders it can be as low as 620 and others require it to be 640 or better. I recommend you make an appointment with a mortgage specialist at your local bank. They will be able to let your know right away what you need to do to be pre-approved for a mortgage
- Hamp Yonce, "Zilluminati"
- Contributions:3463
A loan file is only as good as it's lowest middle score. All the income in the world will not overcome a bad credit history. The cosigned auto loan may have increased yours significantly. If you are about to enter the home-buying fray, have someone (a Loan Officer) pull a three file report that they will freely share with you. If you are still below 680, you may want to wait while your scores improve a little more. Good luck and happy LO shopping!
Is my income more valuable than my credit score?
Our problem lies with credit score, and specifically how much weight it is given when qualifying for such a loan. I have poor credit (578 when i pulled my report this time last year), but have been rebuilding it with a co borrowed auto loan for the last 13 months (not sure what my score is today, hopefully more than what it was). She has excellent credit 700+. We both have incomes of about 50k/yr and have been at our jobs for 4+ years each.
We have not yet applied for the loan, the question is, does the added income I bring to a loan application outweigh the negative effect of my awful credit score?
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