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Good evening. Any suggestions would be great. I am currently a renter in the Syracuse, NY area. I pay $1000 a month for rent, plus water and utilities. I have recently went through the 1st time homebuyers education course and am eligible for $3000 grant. My credit score currently is 581. My car is due to be paid off within 6 months. I make about $48,000.00 a yr. and have $28,000.00 in deferred student loans. My question is that I am tired of throwing my money away on rent. Would I qualify for a conventional loan at this time? I don't want to get stuck with PMI for 30yrs on an FHA. Also have been in the same field of work for over 10 yrs. Thanks

by tyneishagary367 from Liverpool, New York. Mar 20th 2015 Reply


Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 3,446 contributions

Your very low credit score is going to be a major hurdle to getting any mortgage loan. With that score, you realistically will not get any loan whatsoever, regardless of what you may read. Work on improving your score first. Once your score is over 640, then feel free to apply for home loans. As a side note, don't worry about FHA mortgage insurance for "30-years". First, the odds you'll be in the house that loan are near zero. Plus, you can refinance anytime along the way to have PMI removed on that FHA loan.

Mar 21st 2015
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Jericho Cherry (Jerichocherry)
#58 ranked lender in Virginia - 1,107 contributions

There are Lenders that will do a FHA purchase down to 580. You need to find a Loan Adviser in your area to see if they have a lender that can help you. Of course you all to meet all of the other qualifications.

Mar 21st 2015
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Sean Young (SeanYoung)
#2 ranked lender in Colorado - 1,106 contributions

At a 580 you will not qualify for a conventional loan, you would need at least a 620 middle score. The deferred student loan on a conventional loan would have to be counted towards your debt to income ratio. You may be able to qualify for an FHA loan, and most likely the $3,000 grant is for an FHA loan and may require you to have a certain credit score of 640, so make sure you check the grant guidelines as well. With FHA you don't have to count the student loans if they will be deferred for at least 12 months from the date of closing. Contact a local loan officer(s), share your information and have them present you with your options. The place you are getting your grant from will be able to refer you to some qualified lenders. Best wishes, Sean

Mar 21st 2015
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Thank you all for you're responses. I have been working in my credit. I just recently paid off both credit card balances and have educated myself on credit utilization and how that plays a part in your scoring. I didn't know that using all my credit even though paying it all off was still hurting me. I know now to use no more than 20% of my limit to get the best scores. Knowing that I can refinance out of an FHA makes PMI less painful. Purchase price I'm looking at is no more than $100,000. The grant is for any home in Onondaga county and any loan. Not just FHA. Max purchase price $100,000.

Mar 21st 2015
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Gordon Dempsey (travlerm)
#27 ranked lender in Virginia - 26 contributions

I have a private funded program that may be of a benefit to you since your credit score is so low. This program does not look at your credit score at all. I t does not matter what your past credit history is.If you can prove your income and have the affordability to repay a $ 100,000 mortgage you will be approved. This mortgage would be a 30 year fixed with no prepayment penalty. It will loan up to 95 % of the purchase price. Give me a call and I cann tell you how this program will work for you. Thanks Gordon N Dempsey 540 354 9690

Mar 21st 2015
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SHAHROKH CHARLES BEROKHIM (mortgageusa)
#90 ranked lender in New York - 65 contributions

you can get a conventional loan depending on how much is your down payment .but donot wait too long , because the rates are rising and you will pay the price for this delay.we can do loans with low score but need to know more detail. Feel free to call me 516.728.5212NYS license #48442

Mar 22nd 2015
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 7,797 contributions

FHA requires credit scores to be a minimum of 500, and if your score is under 580, you need 10% down.. Lenders go by the mid score of all 3 major bureaus.. if your highest score is 581, then we would need to know your mid score to advise you properly.. keep in mind that most lenders require a 640 or above for Conventional.. with a hand full going down to 620. FHA lenders will require a minimum of 620, but some go to 600, some 580, and a hand full go lower.. understand that the lower the score the more strict the guidelines are going to be, and few that apply actually get approved.. also understand that it takes so much more than a credit score to obtain financing.. do you have a Bk? Foreclosure? Short sale? Delinquent student loans? Unpaid taxes?. you could have a 800 credit score but have one of these deficiencies and still be denied.. The best advice I can give you is to contact a LOCAL mortgage broker and apply with them. Once they see your complete loan profile, they will be better equipped to advise you properly. Also, by applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with many lenders with each one offering a different type of lending program. This is unlike the local bank which typically only has a few lending programs. The more lenders, the more lending options, and the more likely your scenario will be accepted.. Plus, the broker is experienced in seeking out the best loan terms for your particular scenario, and he has lower overhead which typically results in lower rates and fees than most of the larger lenders.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com

Mar 23rd 2015
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Thank you for your help and suggestions. I have recently started the pre qualification on lending tree. A broker had contacted me to give me a little bit more info. I am looking for referrals from friends for a broker in my area. I keep hearing that's the best place to start for my situation. My next credit update is the 26th. Hopefully the steps I've taken to improve my credit shows some positivity this week.

Mar 23rd 2015
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