Bad Credit & Home Loans?
My fiancé and I are in the process of purchasing a home. We are at the early stages (basically saving every dime). What I am concerned about is I am 23 years old (him as well) and I have terrible credit. I made very stupid decisions when I was 18. I have 5 things against my credit report. He is pretty good credit. Since we are both going for the home loan I know they will be taking a look at both our credit history, but I don’t want my credit faults to get turned down.
Here are a few questions if anyone can answer it would be *greatly appreciated*
Do any unpaid debts of mine have to be paid off before I can be approved for the loan?
What are the chances we are denied a loan because of my bad credit?
Thank you.
im no expert but unless they look only at his credit most banks won’t take a risk on bad credit. Same with buying a car, if anyone takes the risk the interest rate would be like 30 % Pay everything off and work on improving your credit.
It is worth to clean up your reports so you can get a good interest rate and actually qualify.
Get your 3 reports from
Annual Credit Report.com
They are free once a year – never pay for them
Get a book on Credit Repair from your library or bookstore
These books are amazing. All the tricks on how to negotiate settlements and do the pay on delete are clearly stated.
I’ve seen people with horrendous credit get homes
1. They cleaned up all 3 of their credit reports
2. They have that nice down payment put together
3. They carry no credit card debt
Even if you pay off items on your report – your score will not improve.
History cannot be earased. Positive side: FHA and major lenders do not go by a 3 digit score. They will review all three reports line by line and act accordingly.
You can also ask here how to resolve the items.
Don’t group them all in one question. Ask separately and give details such as date of default, amount, and kind of debt (credit card, or phone bill – they will be treated differently). Do not give account number or bank name.
Statute of Limitations needs to be considered when making a settlement. SOL
Also name your state – so we can look up the statute of limitations
You will be taking a risk by putting into on yahoo – careful. I would get a book instead
The odds of you being denied are 100%. You simply can’t get a loan.
Paying off your debts will raise your score, which is what you need to do.
If your name is going to be on the deed or the mortgage, or both, the people you owe could file a suit and place a lien against the house, which would endanger the Banks ownership.
Based on the above, they would require you pay off all debts before they would allow your name to be on the deed or mortgage.
Yes, your credit score will be involved, unless your boyfriend has the means to obtain a mortgage loan in his name only. Your unpaid debts MUST be paid off, and they should be paid off NOW. Your chances of being denied a loan because of your bad credit are 100%. Do not even THINK of applying for a mortgage until you get your debts paid and your credit score improved to a decent level.