orgaknight

Single, Middle Aged, Wants to buy first time home

Recommended Posts

Well,

I'm about to turn 46, divorced and I'm just starting to see the light at the end of the tunnel concerning improving credit scores. I want to buy a home but have real concerns about getting an affordable mortgage and a unattached home. I have great income $65k, but with child support obligations, back taxe payments from the marriage years, and staying in school to forestall about 45k in student loans, I wonder if any bank or finance company will even look at me or extend decent terms. I have about 4 years of perfect payment history on my accounts but it is not enough to get my scores where they need to be. Does anybody out there have a similar situation as a single person and were they able to get out of rentals and into a home? Please share your stories, if so.

Fakos EQ 623, TU 648, EX 601

Link to post
Share on other sites

How much have you been paying in rent?

Is the child support current?

Is there a tax lien on your credit report?

If the child support is past due and/or there is a tax lien then those will be tough to counter without a down payment.

Link to post
Share on other sites

sr28b

Impressive 100+ postings

Quite Learned Join Date: Jun 2006

Posts: 129

--------------------------------------------------------------------------------

How much have you been paying in rent? $730 per month for 3 bed 2 bath

Is the child support current? Always, never miss.

Is there a tax lien on your credit report? Nope! In current repayment with IRS.

If the child support is past due and/or there is a tax lien then those will be tough to counter without a down payment. Those are not issues, but they hang out there and I worry the lenders will seize on that as a reason for denial or high interest and terms.

Link to post
Share on other sites

Your scores are fine for FHA; however, the tax lien is a potential stumblingblock. We discussed this on another thread on CIC and I agree with the comment Charles made on that thread.

By chance are you a vet? A VA loan would be ideal and is probably the only loan program that will allow you to purchase without paying off the tax lien.

Here's another thought...Do you like the 3/2 you have now?

If you write a contract for deed with the owner (don't need to record it) and pay 12 months with a cancelled check then there are lenders that will treat the loan as a refinance. If you can negotiate a lower price than the appraised value then you can receive cash out at closing. This cash out may be sufficient to cover the tax lien.

There are probably other options that I haven't thought of but this is what comes to mind now.

Link to post
Share on other sites

Thanks for responding. Again, I don't have a tax lien. I have it in writing that my repayment agreement that the IRS will not place a tax lien against me as long as I am in current repayment. I have already paid half the debt off and have about 15K left to go, which will be paid off in two years.

Link to post
Share on other sites
Thanks for responding. Again, I don't have a tax lien. I have it in writing that my repayment agreement that the IRS will not place a tax lien against me as long as I am in current repayment. I have already paid half the debt off and have about 15K left to go, which will be paid off in two years.

Sorry I'm a little slow sometimes.

It sounds to me like you can quaify for a loan if you find the right house. Probably want to keep the PITI to around $730/month.

Talk to Firstsource about an FHA loan.

Link to post
Share on other sites

How much have you been paying in rent? $730 per month for 3 bed 2 bath

Dang, that's cheap! I pay $975 for a 1bdrm/1bth. Denver... sheesh! (6 years ago, in Topeka, KS, had a 2000 sq ft 3b/2bth townhome with finished basement for $550.)

Link to post
Share on other sites
You might want to take a look at www.naca.com

NACA caters to lower income individuals or those that want to buy in lower income neighborhoods. I doubt at $65K/yr single-income he would be considered "lower income." Hope he wants to buy in the 'hood. It's right there in the NACA FAQ.

"WHO DOES NACA HELP?

To qualify for NACA's services you must have a household income lower than a specific percentage of your city's median income or be willing to purchase in a neighborhood that has been cut off from access to credit ("Priority Areas"). Income restrictions differ by NACA office location. You may not own other property, and you must live in the home while you have the mortgage you obtained through NACA."

Link to post
Share on other sites
Dang, that's cheap! I pay $975 for a 1bdrm/1bth. Denver... sheesh! (6 years ago, in Topeka, KS, had a 2000 sq ft 3b/2bth townhome with finished basement for $550.)

My last place was $1660 a month for a tiny (less than 500 sq ft) 1 BR, 1 bath 3rd floor walkup. Plus electric, heat and hot water. My apartment in Manhattan (300 sq ft studio... yes, ONE ROOM) was $1575 when I moved out of it in 1997.

Welcome to New York. ;)

Link to post
Share on other sites
NACA caters to lower income individuals or those that want to buy in lower income neighborhoods. I doubt at $65K/yr single-income he would be considered "lower income." Hope he wants to buy in the 'hood. It's right there in the NACA FAQ.

"WHO DOES NACA HELP?

To qualify for NACA's services you must have a household income lower than a specific percentage of your city's median income or be willing to purchase in a neighborhood that has been cut off from access to credit ("Priority Areas"). Income restrictions differ by NACA office location. You may not own other property, and you must live in the home while you have the mortgage you obtained through NACA."

it varies greatly by naca location. It's worth going to a seminar and finding out.

It's possible to get a naca loan with a 65K income in a good neighborhood.

Naca does service low-income folks in the hood, but they will give loans in other areas as well.

Link to post
Share on other sites

Your scores are good enough to purchase at 97 or 100% financing. Next step if you want to get good rates is to try to figure out how much your PITI Payment will be and have 3 months of that amount in reserves. (PITI=Principal/interest/taxes/insurance)

Sounds like you have good job history and as long as you can show deferments on your student loans for 1-2 years (depending on the lender) they will ignore those payments.

Charles

Link to post
Share on other sites
Guest
This topic is now closed to further replies.