Low credit Score 690? Frustrating!!!
We are planing to get a home loan for our 1st home in Bayarea which is worth about 1.6M (400k$ downpayment). My credit score is 800 and wife’s score is 690. Reason for her bad score is a derogatory remark from a single credit card transaction for 200$ which went unpaid for few months and line got closed. Unfortunately, I am told that the remark cannot be removed and the low credit will haunt us for ~5-7 more years. We recently found out the drop in credit. Anyways, I got a pre approval from Bank of America which asked me to put 30% downpayment for about 7% APR. Since this was a expensive option I fell pray to an agent who I met in an open house from US bank who promised that I can be qualified with 25% down based on my income and score and yet my application got rejected by underwriters for anything under 30% down. I am unable to do 30% downpayment unless I sell my other investments (Blue chip Stocks/RSUs). Max I can down pay is about 25% which is 400k$ for 1.6M$ home. Please let me know if there are any lenders who can help work around such a situation. I can’t keep trying multiple lenders and our credit score would drop further on more credit checks. Background: I need home in a good elementary school starting next year. Currently renting in a bad school district. Pls help. Household TC : 350k ( 480K) with RSUs #mortgage #housing #lender #bayarea PS: apologies for the typos.
What is your concern with selling some of your stocks/RSUs
I feel that would over-leverage me in the home. All eggs would be in a single basket. Homes are already overvalued but hard to call this a bubble and sit out just to see prices go up again.
You will be over-leveraged when you borrow more for your house (pay less money for your downpayment), not less! It sounds like you want to get the mortgage by paying down as little as you can and have the money in your hands for other purposes, mainly investing it differently. You are probably seeing your house as an investment in the shorter term. At 7% with 25% down, you’ll be paying a whopping $8k in mortgage interest per month for the first few years + property tax. So that extra 5% will only save you some interest.
Just don’t have the wife on the mortgage but have her on the deed
I won’t qualify for the 1.6M home just by myself. Joint application is needed.
I thought 690 is like US average credit score (mine is 810 though)
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We worked with an agency that helps get these off your record. Ask your financier about that if you haven't. Basically they will keep sending requests to the company who placed the delinquent mark to provide proof. If at any time the company doesn't get back within 30 days, the mark will be removed.
“A few months” You’re lucky they will even talk to you
You can work with credit agencies and get the score corrected.. but right now you don't have that much time or you will lose the home. So if you really want that home, do what's needful even if it means selling your RSUs. Also you don't want to blame your wife / this situation for rest of life if you lose this home .. so go for it.
No you can’t. Not when it’s that bad and not an error
Hence asked OP to stay course to get the house and sell RSUs to qualify
PM me and I can help. There is a way to do it .
There are credit repairing companies specializing in fixing issues like this. You can give it a try.
Keep sending the creditor letters using one of those services. I managed to get everything removed before getting my house.
Your wife can have her derogatory remark removed. Just contest the report with the credit agency. They will ask the credit card company to respond. Most likely they will not and the remark will be removed. I had the exact same issue and this worked for me.
Depends on the card issuer. I have a BofA remark from 4+ years ago and tried disputing the dates/balances reported. And they responded.
Do I have to do it with all 3 credit unions. We tried it but did not get a response.