Can we qualify for a mortgage in PA?
We have credit scores of 566 and 572 with a family of 3. We are Poking at purchasing a home for 165,000 in PA. Our scores are low due to a BK in 2003, and turning the keys back over to a lender in 2008 for our 370K mortgage as well as some medical debts (3-6K). We have no credit lines, we paid off both of our new cars back in 2006, we have combined about 4k in revolving debt that we haven't paid on since 2008 when my spouse became critically disabled and unable to work. We have struggled since then, but have been able to pay $2600 in rent for the past 2 years consistently with no problems. Spouse 1 has income of $3100 in disability per month and spouse 2 makes $120K per year but is laid off earning $2200 per month on unemployment since May 2012.Can we qualify for a USDA loan with our scores? And, if spouse 2 goes back to work, can we qualify with our income at that level?We can do a little to clean up our credit, but we found a property within a comfortable monthly payment level that we would like to purchase and renovate a bit.Can we even qualify for a mortgage? by SmithFamilyUsa2011 from Philadelphia, Pennsylvania. May 27th 2012
William J Acres (William_Acres)
#74 ranked lender in Arizona - 8,728 contributions
You're in tough shape... you cannot use unemployment income for qualifying for a mortgage, your scores are way too low, and if you have any judgments on your credit, they will have to be paid.. Keep in mind that the waiting period for FHA / USDA financing is 3 years, but this is from the date the home was taken out of your name.. if you handed the keys back to the bank, but they didn't foreclose for two years, then your waiting period will start 2 years after.. so based on what you have described, you're not able to buy right now, but with the right help, you might be able to put yourself in a position to purchase in the future... The best advice I can give you is to contact a LOCAL mortgage broker, not the local "Big" bank, and certainly not one of those 50 states internet lenders...By applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with numerous lenders, seeking out the best loan terms for your particular scenario. Because he has lower overhead, he can offer you lower rates and lower 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. 480-287-5714 WilliamAcres.com
Thank you for the helpful information. I have another question and some clarifying information.First, my spouse is permanently disabled- officially since 2009 and it is unfortunately permanent. Yes, I can secure another job at or above my previous salary - I am in the third interview for a permanent position at or above my previous salary, but at any time I can pick up the phone and be a contract w2 within a week or two.3.5% down is not a problem and the previous release of property is recorded as 2008 on our credit.Is there any chance of securing a FHA or subprime loan with me working at or above previous salary, 3.5 - 10% down and credit scores as they are?
Patrick Cashman MNLS# 215938 (pcashman)
#25 ranked lender in Pennsylvania - 18 contributions
My answer to anyone looking to buy an affordable home is always yes. Maybe not at the moment but it can be achieved in the near future. I think you should seriously consider budget counseling and there several non-profits that can assist you. You have timely payments on a significant rental payment so that is a great sign that you understand what is important but you have not have structured your budget and possibly your insurance to allow for bumps that will be encountered in life. I would be glad to speak to you and direct you to agencies that can help you to get on and stay on successful financial track. Without ever calling me you can start with HUD.GOV which is an invaluable resource for prospective home owners. Please do not hesitate to call if you have any furhter questions.
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