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Profile picture for hillhouseloan

Refinance with 567 credit score and over $100,000 in equity

Is it possible to get a refinance with a 567 credit score (this is our score before we paid of some of our credit cards). We owe $167,000 on our home and it is appraised at $290,000?
  • February 09 2009 - Waller
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Answers (13)

Profile picture for Texas Banker

It is possible since you have significant equity. However only way to be for sure is to run it thru an underwriting engine.

If your current loan is an FHA I would say your chances are better than 90% on streamline (assuming you are current on your mortgage, and have benefit in doing so).

  • February 10 2009
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HillHouseLoan,

As many have alluded to already, a 567 FICO score would be extremely difficult to get a loan approval in the current market. To get your score marginally higher to 580 - 600 would only get you to the eligibility table.

Working on your credit would be more prudent at this time.

At the aforementioned credit scores, you would still be subject to credit-risked based pricing which means more expenses to you. Ultimately, you need to understand that improving your credit will not only improve your ability to qualify for a home mortgage, but also lower the costs of credit (i.e. auto/home insurance, revolving credit, installment loans, etc...).

Speak with a local Certified Mortgage Planning Specialist (CMPS) and take the steps to a more stable long-term approach towards your financial future.
  • February 10 2009
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If you need immediate assistance, try talking to private lenders who can help.  This could buy you some time while you work on your credit and increase the scores above 580.  For the time being, very few conventional and non-conventional programs are available for lower credit scores.
  • February 10 2009
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I agree with Rob.  You should keep working at your credit.  Soon enough you will have a 580 or 600 and then you should be in the clear.  I keep hearing talk about a 600 Mid score becoming an FHA must.  So keep your eyes and ears open. 
  • February 10 2009
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Andrew,

He is flagged.

Thank you.
  • February 10 2009
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Pete,

Please refrain from leaving your contact info on the treads.

Have a nice day!

Z-Patrol
  • February 10 2009
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hillhouse,
Beware of LENDERS offers with such a poor score currently.  It is better to work at raising the score to avoid painful price hits (even from FHA).  Rates will probably remain low for a long enough time... Do the right thing and get the crappy cards paid to restore yourself.  Going to a lender today with a 567 and you may be walking out of the closing looking like a bronc-riding rodeo champion.... if you know what I mean.  They will get ya...Like the horns on a bull.. and a 567 derserves it... so get as far away from that score as ya can.  Good luck and keep rockin'.  AA, I think PV looks like   Peter Coyote...
  • February 10 2009
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Peter,

No Spamming.  Offer advice not your phone number and e-mail address!
  • February 10 2009
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HillHouseLoan,
Yes,  with documentation of paid off accounts, rapid rescore, manual underwrite with explanation.
If not, a good credir repair company.
Have one for you.

[content removed by moderator for being self promotional]

  • February 10 2009
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Profile picture for Rob Cochems
Keep on working on your credit.  You are in a good equity position, so take the time to get your score up there.
  • February 09 2009
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The lender/broker could do what is called a Rapid Rescore which will update your credit report/FICO score within 30 days.  Otherwise, the lender will not just accept proof that it is paid off, they base the loan on the credit score.

  • February 09 2009
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Profile picture for hillhouseloan
We just paid off 5 of our credit cards but they are not showing yet, would a lender take that into account?
  • February 09 2009
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I don't know of any lenders that are doing loans with credit scores that low.  If you could get closer to a 580 or above, there might be some options for you.
  • February 09 2009
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