well, the score depends on the type of program you want. I can get people in with no money down to the low to mid 500's for owner occupied 1-4 unit-
you can get a home with scores in the 400s, just requires a lot down.
Yes it will lower youscore for the short term... a couple months and then if your score was low, you will actually build it back up with a stong positive account.
if you have anymore question about issues that you do not wish to be discussed on the board, feel free to email me at drifterlrsc@yahoo.com
Thanks for the response drifter! I will take you up on the email offer. Its always good to confer with the members around here. I have a credit score of 603 and am working on removing a couple of items. I am addressing this while I await some of the things needed to implement Johns system. I subcribed to one of those "check your credit sites" to keep track of my score. Look forward to pickin your brain. Thanks
There is really no minimum credit score required to obtain a new mortgage! The kicker is the lower your score the more down payments you will have to come up with.
Your home purchase can lower your score it just depends what your debt-to-income ratio is after the loan.
Your credit score places your Quality Level at B+ to B-. Your Debt Ratio should be around 50 and your Max LTV Ratio
Is around 75% - 85%. Figures are typical and most lenders have requirements that generally fall within these ranges.
Delinquencies and other requirements are not cumulative. Various combinations are allowed but worst-case situations, e.g., maximum number of 30-day plus maximum 60-day, etc., in combination with other blemishes, will generally push the borrower to the next lower credit level.
Mortgage lates are the most important, especially as credit levels deteriorate.
Credit patterns are important. More than a few credit cards or outstanding loans may signal a problem, as do a large number of recent credit inquiries.
A demonstrated willingness to maintain payments is important. Thus, "rolling lates" are less important than lates, which occur randomly, because they signal a continued effort to pay after falling behind.
I would suggest follow these steps to help with your score adjustment:
1. Request copies of your credit rating and credit score from Experian, Equifax, and Trans Union.
2. You need both, because each company may have different information. If the information on either credit history is wrong, correct it immediately.
3. Pay your bills on time. Even if a company allows a grace period, don't use it. It lowers your credit score.
4. Own between two and four credit cards. Fewer cards shorten your credit history; more cards indicate that you are financially stretched.
5. Keep your debt-to-income ratio under 20 percent.
6. Make infrequent requests for additional credit.
7. Pay more than the minimum required on your credit card. Not only do large credit card balances hurt your score; the interest rate on credit cards is exorbitant.
JohnMichael, thanks for the info. I believe you are a fellow Missourian? I am considering either taking a loan from my bank to improve my score or adding a credit card. I don't have much debt (less than 10 percent of my annual income so I have some room to manuver. Is the method of using a savings account as security effective as proposed by Sheets and others? I am starting my investing career with only a couple of thousand dollars. While that may seem good to some it leaves no margin for error. By improving my credit score I can aquire a parachute of sorts(I hope) and perhaps go after more lucrative deals. Thanks for your help.
You asked if using a savings account as security effective as proposed by Sheets and others and
my answer to this is yes and no! I am not knocking this method but this is not a quick fix as is implied by most. This method is a long-term work out. I suggest the following:
Purchase a CD, and take out a loan from the same bank using the CD as collateral because the bank has no risk, the terms of the loan should be very reasonable. This will also work for someone who has a CD and has a temporary cash flow problem, but doesn't want to pay the early withdrawal penalty. Make your payments as agreed. Do not pay off the loan early.
Correct Errors on Your Credit Report.
Pay your bills on time.
Reduce your credit card balances.
Pay off debt rather than moving it around.
Don't close unused credit card accounts near loan time.
Review Your Credit Report.
Add Information Showing Stability.
Avoid Unnecessary Inquiries.
Close Unneeded Accounts
Build a Great Payment History Pay off Credit Cards.
Keep your debt reasonable.
Take Care of Collection Accounts.
Satisfy any Public Records.
well, the score depends on the type of program you want. I can get people in with no money down to the low to mid 500's for owner occupied 1-4 unit-
you can get a home with scores in the 400s, just requires a lot down.
Yes it will lower youscore for the short term... a couple months and then if your score was low, you will actually build it back up with a stong positive account.
if you have anymore question about issues that you do not wish to be discussed on the board, feel free to email me at drifterlrsc@yahoo.com
hope this helps
DRIFTER
Thanks for the response drifter! I will take you up on the email offer. Its always good to confer with the members around here. I have a credit score of 603 and am working on removing a couple of items. I am addressing this while I await some of the things needed to implement Johns system. I subcribed to one of those "check your credit sites" to keep track of my score. Look forward to pickin your brain. Thanks
There is really no minimum credit score required to obtain a new mortgage! The kicker is the lower your score the more down payments you will have to come up with.
Your home purchase can lower your score it just depends what your debt-to-income ratio is after the loan.
Your credit score places your Quality Level at B+ to B-. Your Debt Ratio should be around 50 and your Max LTV Ratio
Is around 75% - 85%. Figures are typical and most lenders have requirements that generally fall within these ranges.
Delinquencies and other requirements are not cumulative. Various combinations are allowed but worst-case situations, e.g., maximum number of 30-day plus maximum 60-day, etc., in combination with other blemishes, will generally push the borrower to the next lower credit level.
Mortgage lates are the most important, especially as credit levels deteriorate.
Credit patterns are important. More than a few credit cards or outstanding loans may signal a problem, as do a large number of recent credit inquiries.
A demonstrated willingness to maintain payments is important. Thus, "rolling lates" are less important than lates, which occur randomly, because they signal a continued effort to pay after falling behind.
I would suggest follow these steps to help with your score adjustment:
1. Request copies of your credit rating and credit score from Experian, Equifax, and Trans Union.
2. You need both, because each company may have different information. If the information on either credit history is wrong, correct it immediately.
3. Pay your bills on time. Even if a company allows a grace period, don't use it. It lowers your credit score.
4. Own between two and four credit cards. Fewer cards shorten your credit history; more cards indicate that you are financially stretched.
5. Keep your debt-to-income ratio under 20 percent.
6. Make infrequent requests for additional credit.
7. Pay more than the minimum required on your credit card. Not only do large credit card balances hurt your score; the interest rate on credit cards is exorbitant.
I would also suggest checking with TCI's Lender finder at http://www.thecreativeinvestor.com/LenderFinder-index.html
[addsig]
JohnMichael, thanks for the info. I believe you are a fellow Missourian? I am considering either taking a loan from my bank to improve my score or adding a credit card. I don't have much debt (less than 10 percent of my annual income so I have some room to manuver. Is the method of using a savings account as security effective as proposed by Sheets and others? I am starting my investing career with only a couple of thousand dollars. While that may seem good to some it leaves no margin for error. By improving my credit score I can aquire a parachute of sorts(I hope) and perhaps go after more lucrative deals. Thanks for your help.
Bigmagic
Yes Bigmagic I am a fellow Missourian!
You asked if using a savings account as security effective as proposed by Sheets and others and
my answer to this is yes and no! I am not knocking this method but this is not a quick fix as is implied by most. This method is a long-term work out. I suggest the following:
Purchase a CD, and take out a loan from the same bank using the CD as collateral because the bank has no risk, the terms of the loan should be very reasonable. This will also work for someone who has a CD and has a temporary cash flow problem, but doesn't want to pay the early withdrawal penalty. Make your payments as agreed. Do not pay off the loan early.
Correct Errors on Your Credit Report.
Pay your bills on time.
Reduce your credit card balances.
Pay off debt rather than moving it around.
Don't close unused credit card accounts near loan time.
Review Your Credit Report.
Add Information Showing Stability.
Avoid Unnecessary Inquiries.
Close Unneeded Accounts
Build a Great Payment History Pay off Credit Cards.
Keep your debt reasonable.
Take Care of Collection Accounts.
Satisfy any Public Records.
Hope this helps
[addsig]