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When should I talk to my credit union about an FHA mortgage?

I am a 36 year old, single dad of two kids (14&15) and looking to purchase a home this summer.  I make about 50-55K per year presently at a steady job for about 7 years.  I haven't had a late payment in 6 years.  My FICO has ranged from 620 to 720 over the past year on CreditKarma.  It is currently at the lower end at 620. 

I put my Phillies tickets on CU MasterCard ($3K) and will be paying it off around the end of March.  I have a chase visa that I am paying off which is currently at $1400.  Other than that, I only have a student loan with 4K on it.  Car loan paid off.  My Discover, Capital One MC, Walmart are all paid off.

I have 3K in the bank, and I expect to have about 4K in there by the summer after paying off my Chase card.  According to CreditKarma, my score will be 737 when I pay my CCs off.  I believe it uses transunion.  I have no charge offs or anything.

I am also in school working on my bachelors in Computer Science, but that is paid for through grants and student aid.

I am planning on taking a 401K loan for the house in the range of 8-10K as I have about 20K in there now.

I am looking at townhouses in SE PA in the range of $150-200.  I am coming up with estimates of 1000-1300/mon with taxes and insurance for a 30 year loan.


When should I look to contact my credit union about the loan?  I am hesitant now as I want to get my score back up to the high 600s low 700s before I do that.  It should be by April/May.

Edit:  I also get 800/month in child support until June 2013, and 500-600 after that until June 2015.  I expect to graduate in 2014 and should be making 60-70K by then either at my present job or another (hopefully barring a big change). 

paying $725/mon for a 2 BR apt which is too small.  Apartment rentals for my area jump drastically to $1400 for a 3 BR.
  • February 21 2011 - US
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Answers (21)

I would contact your credit union as soon as possible and get their advice.  With interest rates so low, you would be well served to move as quickly as possible.  They don't have to run a credit report to give you some good advice. 
  • February 22 2011
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The verification of rent does come up from time to time especially on borderline qualification cases. It is generally not done until further along in the process so you do not have to worry about alerting your landlord too early to your move.  Would be happy to give you a second opinion (and here what games you have remaining)
  • February 22 2011
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" Buying seasoned tickets to a major sports venue can be profitable. .... "

I absolutely agree, just not something I would suggest putting on a credit card for a single parent of teenagers, currently back in school, that has a 620 credit score, limited funds for down payment, borrowing from their 401K and looking to buy a home in a tightening market. 

That's what makes forums great; people can have differing opinions.

$.02
  • February 22 2011
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FYI: I am 100% sure you will get a better deal by working with Joe. Ask the CU what their offer would be today, then talk to Joe to compare.
  • February 22 2011
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In regard to tickets. I have a friend that buys a large amount of Season Tickets to the Lakers for more than 20 years. He has great seats and his regular customers. He earns over $60K a year from them after leaving 4 seats for 4 games for himself. Buying seasoned tickets to a major sports venue can be profitable. .... Go Phillies!

Happy funding, Rudi
  • February 22 2011
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"Forget about all this mortgage talk :) Where are the seats and do you have July 26th available? "

Sorry, they are actually sold.  I have the sunday and A Plan (31 games total).

They are pretty good sears.  Section 103 Row 8 and 104 Row 6 in the outfield.  I was in 102 R13 for the WS.  I can't wait until open day weekend.  I am going to both the Saturday and Sunday game.

Atleast someone on here understands the need to get these tickets off of a plan.  :)

Update:  I talked to my credit union.  They said to start filling out an online app to prequalify in April if I plan to close in July.

Here is a tricky thing though.  I don't want to tell my landlord until June as my lease renewal date is August 1.  She hasn't raised my rent since 2004, and I would rather her not get the idea that I could start paying more.  :S

I remember reading that you need something from your landlord that you haven't been late in 2-3 years.  I guess that I should have checked while I was talking to CU, but do they generally call my landlord to verify no late payments for 2 years when you pre-qualify or when you actually apply with the intent to buy?
  • February 22 2011
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Well, I'm glad you have it all figured out. I guess I must have misread the original question and you are indeed in a perfect financial position where credit and discretionary spending is not an issue. 

Best of luck to you.
  • February 22 2011
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Forget about all this mortgage talk :) Where are the seats and do you have July 26th available?
  • February 22 2011
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I think that ticket purchase is pretty smart! BUT Go Braves.
  • February 22 2011
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In terms of my kids education, I sit with them every night and help them with their homework, volunteer at school and donate to their programs.   They will not be receiving any grants because my ex and my own income will reach about $130K.  I spent 5 years putting her through school only for her to bail on me when it was my turn to continue mine.  I will be helping them.
  • February 22 2011
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I put the 3K on my card with the intention of paying it off in March when my tickets come in.  I do this every year.  Between selling them to friends and on stubhub, I usually end up paying $500 for 3 seats to ten games.  You do the match. (OK, I will.. that is about $15 per ticket).  I don't pay for cable and keep my expenses way down.  I am actually in a really good position economically.

I already have $2K sold and still have 18 games available (going to 10)

They changed the laws about 8 years ago so that we are actually allowed to sell out tickets for market value.  It can be a pain to do this, but it is the only way I can justify taking my kids to the games.  Furthermore, you can only get postseason tickets with a season ticket plan.  They got me to a World Series in 2009.  That is a priceless experience.  :)

And to the post about taking grants.  How dare you say such a thing.  I paid for my first semester on my own.  I work hard (50 hours per week) making $50-55K per year.  I pay my taxes and contribute alot to society.  By taking a grant to continue my education (I have a degree in history but am switching to computer science), I am actually enabling myself to contribute more to society.  This is the type of grants and aid we should be giving out.  It isn't like the bank bailout or general welfare where little if anything is returned.  You sir, should be ashamed of yourself.

In todays climate, we continually have to change with the changing market.  I am doing just that.  I am also doing working more than full-time.  That is just bad form, sir.
  • February 22 2011
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I wonder if that letter has more response when they say Five Million Five Hundred Thousand vs just saying 5 Million Dollars. Is the plan now to stop emailing Zillow users and just post this stuff on different threads? 
  • February 22 2011
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Contact someone now to see what your actual score is, but I agree with Andrew... 3K for tickets? Seems that a struggling single dad could choose more wisely what to do with 3K... perhaps college funds for his kids so they are not relying on grants and student aid at age 36? Don't mean to sound preachy (yes I do) but if I were trying to better the lives of my kids by getting them into a home, I would not be buying Phillies tickets. 
  • February 22 2011
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No one is addressing the real issue! 

Phillies Tickets?

If I were in the PA area and needed mortgage assistance I would call Joe C.
  • February 22 2011
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Auction..  I would suggest sitting down with a mortgage professional ASAP to get a handle on your credit scores and finding out what you would qualify for.  As Clay mentioned the scroes that you are getting from CreditKarma are useless for mortgage purposes.  If you have not missed a payment in over 6 years, does not make a lot of sense why your scores ever got down to 620. 
  • February 22 2011
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From Credit Karma's Website:

Credit Karma provides users with their TransRisk New Account Score, VantageScore, and Auto Insurance Score as supplied by TransUnion.

None of those are Fico.
  • February 22 2011
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creditkarma gives a FICO for your score.  They also provide the new vantage score.  It is a good service and you can check it as often as you like.  I also check on quizzle.com every 6 months.  They use experian.

So, some are saying before closing.  some are saying ASAP.  I will call them today and report back what my credit union says.

In my position, I often submit credit apps for auto loans so I am somewhat famaliar for what a bank looks for in a loan on a 10-40K consumer loan.  I understand that mortgages are a different matter, but much of the info is still relevant.  In the car business, we work on a 30 day window.
  • February 22 2011
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About 60 days ahead of closing. What do the monthly payments add up to that are reporting on your credit report? I have no idea what scoring models are used by Creditkarma but if not Fico, then they are irrelevant. 
  • February 22 2011
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Contact your credit union directly, they are the one giving you the loan so they are more then qualified to guide you towards a pre approval and to give you advice on what you need to do to get your score back up where it needs to be. Good luck!
  • February 22 2011
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I am not saying that I need it.  I am looking at the long term.  I should be making more by then anyway.  The 50-55 if actually after my medical deductions.  So, I am actually making about 55-60.  I should quality for a $180K +/- mortgage for the P&I.

Your reply didn't really relate to my question of WHEN.
  • February 22 2011
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ASAP...

IF you need the Child support income you will not be able to include it since it will not continue for 3 years. 
  • February 22 2011
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