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For all you real estate guru's.. First time homebuyer question.

L

Locke

Golden Member
Hey guys. I was talking to one of my co workers, and he mentioned how a friend of his had just bought a decent 2 bedroom, 2 bathroom house. He said she took advantage of some government programs for first time home buyers and relayed to me these items..

- Credit doesn't matter as much as having a stable income(28K+ for this program)
- Something about making over 28K/yr and being a first time home buyer.
- He said his friend had fairly bad credit and recently went through a divorce to boot.


Anyway, I just just curious becuase sometime in the near future I'd like to stop renting (Read: Throwing my money away), and start putting my money into something that I could benefit from financially 😀 I ran into trouble with credit cards early on(when I was 18), (charge offs and the like) but I've been working toward eliminating what debt I have. I think the charge offs will dissappear in about 2 years. ^_^ Anyway, even with my not so hot credit do these things my co worker said hold any water? I make just about 28k/yr, and will have for over a year in the beginning of 2005.
 
try going to equifax.com and look at your FICO ratings. This is the ratings that is used by home loans institution to judge you. Look at your FICO score. If you're above 700, it is golden.

eRr
 
You may be thinking of an FHA loan. Typically these require 3% down and are a little less stringent than conventional loans. However, if your credit is messed up I don't think you would easily be able to get into one. I would begin by checking your FICO score.
 
I'm very sure this friend was talking about FHA/HUD loan.
Technically, FHA/HUD does not care about FICO scores. They do care about outstanding delinquent debt (like those charge-offs) and require at least a 3 year period after any bankruptcy or foreclosure. They do like to see clean credit in the last 12 months and they do require a minimum 2 year work history (though not necessarily on the same job or in the same line of work even). Debt ratios need to be in line, there will be a maximum loan amount for your area, and you will need to put a minimum 3% down (although this can be done for you by donor or gift if you can find that).
The good news about FHA/HUD is that they are very flexible. They frequently do low-down home purchases when no one else will, often with relatively poor borrower credit and at attractive rate pricing. The bad news is that they are government, and the paperwork is somewhat complex. The other bad news is that if you have EVER defaulted on any federal government loan, even (especially) student loans, then you are automatically declined.
 
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