Would I be turned down a good mortgage loan?

Deal Score0

I’m a divorced mother of two. I make 46,000 a year, $ 10,000 worth of debt and a credit score of 710. I’ve been told by “people” that I couldn’t get a good interest rate b/c of my debt. I’ll be looking for a home (I’m renting now) come February. Am I condsidered a bad risk?

I’m behind in my payments and not comfortable negotiating with the bank myself.

  1. Reply
    February 2, 2011 at 5:46 am

    710 sounds fairly normal to a high normal.
    You won’t get a great interest rate, but you should get a fairly good one. And keep in mind, that if you pay on time like you’re supposed to, your score will go up and you can refinance after five years and fiance less and get a lower rate. (Hopefully).
    Good luck!!!

  2. Reply
    B P
    February 2, 2011 at 6:40 am

    As a REALTOR in Virgina, my suggestion to you is to go to a LOCAL Mortgage Broker…not online. Mortgage Brokers who are local know the area best and you will qualify faster. Your credit score is fine. Will you be a first time homebuyer (first time on your own)? There are many programs out there for those who are. Big piece of advice: Get pre-qualified and then you will know what price range to look in. Depending on your area, get what you can afford…even if it is a townhouse or condo. You will be on your way to homeownership. Ask about PMI insurance and what that will add to your mortgage payment. In Virginia you can get into a house with very little down (also ask the seller to pay your closing cost) One more thing get a Real Estate Agent who DOESN’T have the most listings in town, but is full time and committed…it helps if you like him or her. Someone who has just started in Real Estate may work twice as hard to help you find a place…..and they will definitely get help from their broker writing the contract and protecting your interest. Sign an agreement to work strictly with that agent….you will definitely get better service. That’s all from Virginia….now go out and get pre-qualified and then shop for an agent you feel comfortable with.

  3. Reply
    February 2, 2011 at 7:38 am

    Your score is pretty good. You may not get the best rate but you should get a very competitive rate. It also depends upon how much you plan on borrowing. Your debt, total debt, is not as much an issue as how much you have to pay each month. If the $ 10k is more than 50% of your monthly income as to debt service, there will be a problem. However, a mortgage broker or lender should easily be able to work with you.

  4. Reply
    February 2, 2011 at 8:22 am

    Check out FHA loans…you should qualify, and the rates are GOOD…you may even be able to get into a home with little or no money down…make sure that if you use a mortgage broker that they are able to do FHA loans, as they must be licensed to do them, and most are not.

  5. Reply
    February 2, 2011 at 8:26 am

    with your credit score, you can get pretty good interest rate. the problem with your debts is ,that maybe you will have to hide your income and use the program we call no income verification. the interest rate is slightly higher, but not that much and the question is if you can afford to make payments ? before you will go and look for the house, talk with the mortgage broker and see how much you can easily afford to pay- this way you will know what price range you will qualify. always talk with the people who are know what they talking about ,not some “people” they thing they know.

  6. Reply
    c b
    February 2, 2011 at 9:18 am

    710 is a high score. I don’t know what “people” you have been talking to but they are wrong. There are so many things to consider that giving limited information does not allow anyone to give you a good answer as far as what you will qualify for. In order to give you a clear picture of what you can and cannot qualify for you will need to give more than just the income and score. They will need to know what your monthly debt to income ratio will be based on the new payment, what your past credit history is, your current last years rental history, current time on the job and numerous other factors. If you are not looking til Feb. my suggestion would be to look into it in December. That will give you a couple of months to take care of anything needed prior to being out there looking. I have over 13yrs experience in the mortgage industry and if you would like I may be able to get you pre-qualified. If you are interested email me at cbrown@structuredmortgageltd.com or call (614) 985-3771

  7. Reply
    February 2, 2011 at 9:42 am

    First, go to this site:


    This site will help you find a certified HUD counseling agency in your area. HUD counseling services get federal funds to counsel home-buyers and home-owners. Many of them are offering very good advice to home-owners who are wanting mortgage modifications. They may also be able to help you negotiate with your current bank to get the modification.

    Do not go to just any “counseling service” as there are SHAMS out there – go to a certified HUD counselor only! And if they give you any grief or problems report them to HUD!

  8. Reply
    February 2, 2011 at 10:39 am

    There really is no negotiation involved at all. Don’t waste your money paying someone else to do this for you.

    The bank is going to offer one deal and one deal only. There is no back and forth negotiation.

    You tell them you need to modify. They obtain financial information from you to see what you can afford. They look at the loan and come up with the deal that they will agree to and offer it to you. You can either accept or turn it down. If you turn it down, they will continue the loan as is and will only foreclose if you later default.

  9. Reply
    February 2, 2011 at 10:56 am

    Call your lender. You already have money problems. Why pay for something you can do yourself with a few phone calls? There’s nothing to it, really. You qualify or you don’t. Negotiation skills not needed.

  10. Reply
    February 2, 2011 at 11:29 am

    The Federal Government has set up a website to educate homeowners about the loan modification process-www.makinghomesaffordable.gov. Basically there are 5 requirements to qualify for a loan modification. They are:

    1. The home needs to be the homeowner’s primary residence;
    2. The mortgage must be less than $ 729,750;
    3. The homeowner is having trouble making their existing mortgage payment;
    4. The mortgage was established before January 1, 2009; and
    5. The homeowner payment on their first mortgage (including principal, interest, taxes, insurance and homeowner’s association dues) is more than 31% of their current gross income.

    Homeowners don’t need to pay a company to obtain a loan modification. However, sometimes it can be better to have someone, such as a lawyer or credit counselor, negotiate on your behalf. A good strategy is to talk to as many experts as you can prior to contacting your bank. Many of these services will give you a free consultation.

    A good site to begin can be found http://www.credit-hub.net/loan-modification where I entered some details about my current mortgage and the company got back to me multiple loan modification proposals.

    I ended up contacting the bank by myself, but knowing what was possible in advance helped me tremendously.

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