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Looking to purchase, but have below average credit


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I'm looking to purchase a home within the next six months, but I do not currently have the greatest of credit. A recent pull of my FICO scores show:

Equifax - 577

Experian - 606

TransUnion - 573

Believe it or not, these are up over 100 pts from this time last year.

While these are rather less than desirable, I am tired of living in an apartment. My current lease is set to expire at the end of Feb '06, and would like to find a place in the $120-$140 range.

Can anyone recommend an above average company that deals with people with sub-par credit? I have the VA loan available to me, but do not know if I should use this now, or if I am even eligible considering my credit is not the greatest. Also, I would like to get into a place with little to now money down.


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You have done a wonderful job, 100 point increase in that short of time.

Once you have gone over 580 for your middle score, then you will qualify for 100% financing.

Now, that does not mean 0 money from you, unless you can make a deal with the seller of your new home.

Ask for 6% of the sales price to go towards the closing costs. That should cover most of the costs.

For most lenders you will still have to pay a years worth of home owners insurance up front, and for what is called prepaid interest. That is a charge to take the day of funding to the end of the month, so that your payments will be due on the first. (If you close on the 10th, you will pay for 20 days, 15th for 15 days, etc)

There are some lenders that will allow the seller to pay those costs also.


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Thanks, I'm pretty excited about the 100 + point jump. It seems like the past few months, I've been stuck like this and am not seeing any improvement. I'm proactively addressing this and am staying on top of my credit reports every month. I currently have some things disputed, so I'm hoping when the 30 days is up later this month, my score might be up a couple more points.

Would you advise that I contact someone now to see if I can be pre-approved, or should I wait until my scores improve? I know the higher my scores, the better rate I will receive, but I'm at the point where I will take a high rate now and re-finance a year or two from now. I'm also leery about making the move, because I do not want the excessive inquiries on my credit report.

Again, thanks.

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