Mortgage w/ 629-650, 20% down?

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Scores were right around 629, but I have since done the following things to try to boost the score:

1) gotten myself removed as authorized user on 3 bad RC accounts that were not in my name

2) gotten myself added as auth user on an aged, perfect history account w/$ 10k limit and minimal balance

3) paid off the two collections items on my report, one in full, the other settled for less.

I now have no unresolved bad debt, and as for credit I’ve got an auto loan in good standing and now this new auth user account.

My income-to-loan ratio is very good and I can put 20% down.

The homes I am looking at are non distressed properties priced well below their appraised values – the one I am most interested in is ‘underpriced’ 30%. So that plus my 20% down payment…

I have been with my employer for 10 years. I currently rent a home and my rent payment history is clean. For the past 7 years my rental payment has been bigger than my mortgage payment will be

I have just started pre-approval shopping. Any advice? Any thoughts about my chances for approval?

4 Comments
  1. Reply
    ☆**•¸Hey! You asked!¸•**☆
    May 3, 2011 at 6:10 am

    Actually you have done great for yourself..

    I am a homeowner myself.

  2. Reply
    Zarg222
    May 3, 2011 at 7:08 am

    could take months for those “fixes” to be reflected on your credit report – I would wait until after the new year to really start getting pre-approved

  3. Reply
    Rebecca
    May 3, 2011 at 7:47 am

    As far as your score no you have not done great because most of those will make little difference and the authorized user thing will not help at all unless it is your spouses account. But you have done great in cleaning things up, Congrats!

    Try FHA loans because those scores are too low otherwise, need 660 minimal and some established credit in YOUR own name.

    Again Congrats on cleaning up the reports.

  4. Reply
    bdancer222
    May 3, 2011 at 8:26 am

    Paying off the derogatory items won’t improve your score. The damage is done and will remain for the balance of the 7 year reporting period. However, mortgage lenders will require that ALL negative items be resolved before approving a loan.

    Unless the cardholder is your spouse, none of those authorized user accounts will help your score. Autorized user accounts only count in the score for spouses and kids. Adding those accounts to your credit report could actually hurt you. They will be included in your debt to income ratio, even tho you don’t make the payments. A high debt to income ratio will get you turned down faster than bad credit.

    You might qualify for a FHA loan but probably not a conventional loan. Pre-approval is a good idea. That way you will know exactly what you can afford to look at.

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