Do you know what it feels like to finally become a home owner for the first time, at age 47?
The words triumphant, victorious, and successful come to mind.
Wherever you are on your financial journey, don’t give up. Below are 10 Facts about qualifying for a home loan that might surprise and encourage you.
Earlier this week, one of my book readers wrote to say that he is soon closing on his first home.:
“I am grateful for your books and presence. I am buying my first house at 47 after building my credit and securing a mortgage following your advice. Thank you for your excellence and kindness.”
Ten home buying facts:
1) There are zero down loan programs available for U.S. Military Veterans, people buying in a non-metropolitan area (USDA loan), people of minority groups who live in specified areas (see last week’s post).
2) The Federal Housing Admin offers 3.5% down payment for credit scores down to 600. Bankruptcy Chapter 7 okay if discharged for 24 months.
3) Medical collections are ignored.
4) Tax debt is okay as long as you have a payment plan and have made at least three consecutive payment
5) Mortgage lenders go by the middle credit score of three, with the lowest score being thrown out.
6) Two years’ employment required and does not have to be at the same job. College counts toward that timeline (you would then need one year of employment for income qualification).
7) Two years’ self-employment required. (You cannot combine one year W2 and one year self-employment.)
8) For part-time work, two years required to count it.
9) Disability income, social security income, child support income, spousal maintenance income all count as long as they will continue for another three years or more.
10) A mortgage broker can shop the wholesale lenders for you with only one credit pull.
Thank you for reading. If you need some inspiration, see here.
Great information Carolyn. Thank you for that. I’m currently fighting to get my FICO 2 score to 700 with a current 688. Is there somebody you recommend that might be able to lend me advice on how to improve that score? Thank you.
Ruben, I sent you a personal email with my recommendation. You should be able to see it in your in-box now.
Hello Ms. Warren,
We’ve communicated in years past regarding your books on credit. Now it’s time to purchase a home. All debt is paid off, working on saving right now and have been doing a lot of basic research. Any other books you recommend we read prior to purchasing?
Good job in getting your debt paid off and saving money! Well done. I have not been reading home buying books this past year, but I have the book Zillow Talk and found it interesting and sometimes shocking. I’m not sure if it is the type of information you are looking for. It is the “Freakonomics” of real estate. I wish you all the best in your home buying endeavor!