Credit mid-scores good, but other issues.....

Generally speaking, the smartest move is to stop looking, and stop thinking about buying a home until you are credit ready to buy a home. Lots of people will tell you to apply here or there, and that there are program for your score... But realistically, you two are not ready to buy yet. Even your 640 score, while OK for many programs, is NOT A GOOD SCORE. It is a very low score, and while you may find a loan with that score, he will not, and you will have limited loan options, and pay a higher interest rate. Once you've received proof that BOTH your scores are over 640 with no disputed items, then you will be ready and in the best position to apply for home loan financing.

Carlyn, Many lenders will approve an FHA loan with a 620 mid-score & some will allow for even lower scores. There are specific FHA guidelines on disputed accounts regarding whether a loan can be approved utilizing an automated underwriting system vs. having to be downgraded to a manual underwrite (which many lenders are no longer comfortable doing). Provided the disputed accounts fall into one of the following categories, an automated approval is acceptable: (1) Disputed account has a zero balance; (2) Disputed account reflects it is paid in full or resolved; and (3) Disputed account is both less than $500 & more than 24 months old, based on the date of dispute.If you meet these requirements, you should not have any problems. Best of luck!

Carlyn,I am in the Tampa Bay area and we only require a 620 score to get pre-qualified for an FHA loan. I can take your application and work with you so that when your husband's score reaches 620 we can move forward. Please feel free to contact me at 727-518-7818 to discuss this further.Best Regards,Linda

You have already received some great advice regarding the disputed accounts. I have one investor that will go down to a 600 score but you will need to meet certain additional requirements to qualify. I am also in Tampa.

I have to agree with Joe on this. Until you are credit ready, you should not be looking. Score criteria is different for USDA than for FHA. There are lenders that will go as low as 580 for an FHA loan, but the "penalty" for the low score is a significantly higher interest rate. It can take as little as 2 weeks to get a score up DEPENDING on why it is low. Larry is also right. DO NOT dispute any of credit items. To get underwriting approval acceptable to FHA, ALL references to an account being disputed must be removed. You will want to work with a local, Licensed Mortgage Banker, one that has a good presence in your area. You can check out your selected Mortgage Originator at the National Mortgage Licensing System at www.NMLSConsumerAccess.org ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com