Obtaining a mortgage with poor credit.
By FlaviousJ
@FlaviousJ (16)
United States
November 16, 2006 3:40pm CST
How likely would it be to obtain a decent loan for a mortgage with a credit score that's under 600? My credit has been struggling during the last year and with recent unexpected financial difficulties I think it's getting worse. I want to get a condo within the next year and I am wondering how realistic this would be. I live in Chicago and my ideal condo would be in the price range of about $175,000.
3 responses
@babygyrlsugar (25)
• United States
16 Nov 06
Highly unlikely...unless you put down a huge down payment...
My boyfriend have a 3bedroom 2 bath home in a very upscale neighborhood under 80,000...he is struggling with this credit. If you get with the right realtor who will and can help you...hey...i could happen.
Government have housing loan programs for 1st time buyers. You should look into that....i hope i have help
@musicaldiva519 (7)
• United States
26 Feb 07
Here is the deal. Having a credit score doesn't mean that you wont qualify. In all honesty you're rate won't be the best, but you'll get a mortgage. What the lenders really look at is your debt to income ratio. That is how much you make vs. how much you owe. To figure it out just add up all of your monthly debt then divide it by you're gross monthly income.
For example:
You owe $2,000 a month
You make $4,500 a month
2,000/4,500=.44
So your Debt to Income ration is 44%
Thats not a good number. Most lenders like to see your Debt to Income ratio be 50% below INCLUDING the mortgage that you will be taking out. There are programs available however for people with a high debt to income ratio. Contact a mortgage broker, don't use a bank (they wont be able to help). A mortgage broker will be able to help you find the best program and the best rate for your situation. I have worked for a mortgage broker/lender for some time now so I see this every day. Unfortunately I'm not licensed in Il or I would help you.
