advice for heading in the right direction regarding home ownership - Page 4

Misfire · #31 04-26-2006, 05:07 PM

If the negative info on your credit report is inaccurate, dispute it. Do it yourself as it's not that hard and paying someone is just a waste of money.

If the negative info on your credit report is accurate, that sucks. If everything's paid now, those marks will fade over time.

You don't need a credit card to get a loan. (Hell's Bells, you just got OUT of debt. Why jump back in???) Find a mortgage company that does manual underwriting and show them how you've paid your rent and utilities on time for the past two years and you'll be fine.

Put at least 20% down to avoid paying for private mortgage insurance. If you can't save 20%, you probably can't afford a house.

Sniper · #32 04-26-2006, 05:12 PM

Misfire, the reason to open a secured CC account, is to start rebuilding his credit.

sprmario · #33 04-26-2006, 06:06 PM

I disagree... dispute it all. Just do so in an orderly manner and don't claim that the items are false. I would just write saying that I believed this item was not quite right and to please have it verified.

Correct or not correct, after 30 days they have to remove it.

I would do this yourself. Yes, it's a bit of a pain, but I think that 90% of the services out there are scams and they do potentially illegal things in your name. Just suck it up and do it yourself.

[ QUOTE ]
If the negative info on your credit report is inaccurate, dispute it. Do it yourself as it's not that hard and paying someone is just a waste of money.

If the negative info on your credit report is accurate, that sucks. If everything's paid now, those marks will fade over time.

[/ QUOTE ]

Misfire · #34 04-26-2006, 08:32 PM

[ QUOTE ]
Misfire, the reason to open a secured CC account, is to start rebuilding his credit.

[/ QUOTE ]

Thanks, I hear the Pope is Catholic too.

For the purpose of buying a home (the point at issue), a mortgage company that does manual underwriting can approve a mortgage without requiring OP to rebuild his credit--thus, a credit card is unnecessary. If one prefers to stay debt-free, he can, and he'll still be eligible for a mortgage.

ElaineMonster · #35 05-03-2006, 02:52 AM

Wow, this thread is filled with terrible advice. To the OP, your goal is to buy a home, right? Your goal is not to have a clean credit report. So, start by going to your bank and applying for a loan. Or, if you prefer, go to well-known mortgage companies.

a) If they don't approve you, you can get the credit report they used for free - the info will be on the denied letter.
b) If they do approve you, but you don't like the interest rate or the terms, you can still get the credit report for free.
c) If you get the loan you want, great, goal is halfway there. Now, go house shopping.

If a) or b) happen, clean up your credit report by disputing the incorrect/ out-of-date items. I suggest doing that online as I've had better success that way.

If you prefer mail, make sure your letters are sent certified. (Reporting agencies have no qualms about pretending they never got mail and therefor never responding. If you have no record, they can and will delay your dispute claims forever. The online record is easy - just print it out.)

You can also get your report for free from annualcreditreport.com buy why use your one free report per year when you can just start at the natural beginning by applying for a loan? (Not that it matters much either way. The cost of the reports is about $20-$30 from all three reporting agencies - Equifax, Experian, and Trans Union - so it's fairly negligible).

But, listen to the bank. They will tell you why you're getting a crappy rate on the loan or why you're being denied. There are LOTS of reasons and it may have nothing to do with your debt. Ask them for recommendations - they are often eager to help (though be careful, they don't always know what they're talking about).

About the First Time Homebuyer programs: They are often income based. So, if you have low income, you may qualify. There are also race-based programs and others for different home regions. Again, talk to a lender, they know the details.

Lastly, these days you don't need 20% down and clean credit to buy a home. Home ownership is becoming more and more like car ownreship. Almost anyone can get a loan somehow.

So, stop getting so worried about it and just go out and do it. I know it's scary, but you have to just jump in! You're going to make mistakes, we all do, but hopefully you won't make huge, irreparable ones. Have fun.

Oh, and forget about paying a service to clean up your credit. And forget about a secured credit card. Both will just postpone or screw up your end goal of buying a home. Remember your goal and re-evaluate your method of attaining that goal.

Sniper · #36 05-03-2006, 03:01 AM

[ QUOTE ]
Wow, this thread is filled with terrible advice. To the OP, your goal is to buy a home, right? Your goal is not to have a clean credit report.

[/ QUOTE ]

Why do you think there is terrible advice in this thread?

Whether he buys a home or not right now, he should be cleaning up his credit, especially in light of the fact that any negative info on there he knows is cleaned up and just needs to be removed!

As a successful affiliate and successful poker player, Sublime is rolling in dough, his credit report should reflect that, and he can do that at minimal cost by putting some time into it.

sprmario · #37 05-03-2006, 10:33 AM

Your advice sucks. You will not absolutely positively get a good rate with a mid-600s credit rating. At that level you are considered sub-prime and will get a miserable rate. Every time you request credit, your credit score goes down. Requesting a loan that you know will be crappy just to get the free report is stupid when you can get the free report anyway.

Getting the "loan you want" is a stupid goal. There are all sorts of people right now that got the "loan they wanted" and are in the process of being screwed because what they wanted is not what was good for them. A lot of people have interest only loans, short intro period ARMs, and even negative amortization loans. They got the house they wanted then, and now they might lose it due to ARMs adjusting and their principal payments starting.

[ QUOTE ]
Wow, this thread is filled with terrible advice. To the OP, your goal is to buy a home, right? Your goal is not to have a clean credit report. So, start by going to your bank and applying for a loan. Or, if you prefer, go to well-known mortgage companies.

a) If they don't approve you, you can get the credit report they used for free - the info will be on the denied letter.
b) If they do approve you, but you don't like the interest rate or the terms, you can still get the credit report for free.
c) If you get the loan you want, great, goal is halfway there. Now, go house shopping.

[/ QUOTE ]

ElaineMonster · #38 05-04-2006, 01:55 AM

Super Mario,

Not all the advice in this thread is bad, but there's quite a bit of it. (Unless I'm misreading sarcasm).

Actually, you can get a decent loan even if you're FICO score is in the mid 600s. Hmm... I know a girl whose score was in the high 500s and she got a fixed rate at 6.5% for her home. Of course, now that she's a home owner, her score is in the high 700s.

I'm not saying he shouldn't clean up his report, I'm just reminding him that's not the goal. And he's just wasting time if he focuses on fixing his credit. Repairing a bad credit report can take months, even years. Getting a decent home loan just takes the right mortgage company.

And the advice about a secured credit card is just silly. If he really wants a CC on his report to show a good payment history, he can easily get a non-secured card, maybe even at a bad rate, and just pay it off each month. (The rate doesn't matter if you don't carry a balance, remember? But this is a guy who probably still has a few money issues and probably shouldn't have any extra available credit right now. He needs to buckle down and stick his money in a house.)

The OP should be spending more time learning about loans and deciding what he wants rather than repairing his report. I am NOT suggesting an ARM; I am suggesting he go talk to a lender or three, or pick up a book about buying a home.

Sniper · #39 05-04-2006, 03:33 AM

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I'm not saying he shouldn't clean up his report, I'm just reminding him that's not the goal. And he's just wasting time if he focuses on fixing his credit. Repairing a bad credit report can take months, even years.

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His credit problems are behind him... he should have responses from the credit agencies within 30 days. There really is no reason for him to delay getting this stuff cleaned up.

sublime · #40 05-04-2006, 08:30 PM

just to add something.

i HAVE an unsecured VISA thru the credit union i belong to (which was industry specific, and i don't work there anymore. they let me stay a member anyways) which has been paid on time AND IN FULL for the past 3 years. i STILL have a score of ~600.

i have to go print up my reports tomorrow and then mail in some disputes (just negative info, even though the accounts are PAID).

Elaine, getting the letters certified was a great note, thanks. since i plan on buying in vegas, maybe i can have you and ed mentor me in the home buying process [img]/images/graemlins/smile.gif[/img]

i guess i make too much to qualify for a first time buyer, but i will of course exhaust all avenues.