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Thread: Getting a mortgage...

  1. #1
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    Getting a mortgage...

    I read though this whole thread: http://www.mp3car.com/vbulletin/off-...-novel-24.html and I really learned a lot. But it made me remember about one of my goals, which is buying a house by next May.

    My only problem is my credit. I don't have much of a credit history:

    -Renting an apartment for almost 2 years (always on time - do lenders look at this for a mortgage)
    -Utility bills in my name for almost 2 years (electricity, cable, cell phone) never late
    -GEICO auto insurance for 6 months, before that Nationwide for almost 2 years
    -Just 1 credit card (Capital One) again never late (had it for 3 months), always paid off every month
    -$5000 personal loan (had a cosigner) I got last month to buy a car, assuming I pay that off fast (its a 5 year loan @ $102/month, so I'll throw down $300/month and have it paid off in around 2 years)

    I'm 19 almost 20...

    But, I just tried to get DirecTV and I have to pay the $200 fee because of my "lack" of credit...so it's still not there...

    Assuming I keep my track record of paying everyone listed above on time, what are the chances of a bank/lender giving me a shot with a mortgage? I would go talk to them, but considering I just applied for the loan a month ago and another credit card, I don't want them to check my credit too much...

    Basically how much credit history did you all have when you were given your first mortgage? Would you say that it is harder or easier then getting an unsecured personal loan? A car loan (I was approved without a cosigner for a $5000 car loan but didn't take it because I didn't want to pay full coverage insurance)? Thanks guys!
    -Josh

    91 Acura Integra RS Hatch
    95 Honda Accord LX Sedan (daily driver)

  2. #2
    Banned Motorcity's Avatar
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    Just curious, why the hell would you take out a 5k loan to buy a car, and not insure it full coverage?? At least while you have the loan open. That is an absolutely stupid move on your part.
    What if (God forbid) you go out tonight and wreck your ride beyond repair? or if it gets boosted and is never recovered? you are SOL beyond belief. You will owe that loan and have nada for it.

    Sounds like home ownership is not a responsibility you are ready for just yet.

  3. #3
    Constant Bitrate mwmcginn's Avatar
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    Quote Originally Posted by Motorcity View Post
    Just curious, why the hell would you take out a 5k loan to buy a car, and not insure it full coverage??

    Sounds like home ownership is not a responsibility you are ready for just yet.
    Where do you see that?

    Anyway, whats your credit score? You can find out by requesting a copy of your credit report. Lack of credit (due to no history) is much better than bad credit. I would talk to some small bank's loan officer. Tell them your situation. Build a relationship. They may want to sell you a house if they repo'd one. Regardless though, think about an fha loan, as they are federally supported, for first time buyers.
    Mike M
    2006 Accord VP Sedan

    My worklog
    http://www.mp3car.com/vbulletin/work...-dads-car.html

  4. #4
    Bowel movement jjh221's Avatar
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    pm me if you are really interested with a loan.
    I GIVE FREE HUGS!
    Buy Sell or Trade
    If my pm box is full, please feel free to call me any time. 440-328-3382
    Thank you
    Forex
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  5. #5
    Unregistered User ODYSSEY's Avatar
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    Most lenders just look at your fico score.

    All your utility bills, insurance, and personal loan have nothing to do with your credit score, unless you are late and they report it. (Which will only lower it)

    The only thing getting reported on your credit report is you cap1 card and guess what? They only report the highest outstanding balance and not total credit available. Which can hurt your credit score.

    Do you have steady employment?

    Do you have 20%, 15%, 10%, or even 5% to put down?

    Do you even have ~3% for closing costs?

    Do you even know who much you can borrow and the types of homes available? (Take your yearly gross pay and times it by 3.5)

    My suggestion. Rent a low cost apartment for ~1 or 2 years. Save at least 10% for down payment and closing cost (More if you can). Pay off any and all debt (personal or not). Use a credit card for every possible purchase, but pay it off EVERY month in FULL. Do not apply for any NEW credit within a year of getting your mortgage.

    Also I would suggest taking a first time buyers class. Find one that is free and not associated with a lender or real estate agent (no pressure). Sometimes these are ran by local non-profits or government.

    Take a visit to www.fatwallet.com and go to the finance forum.
    ODYSSEY

    Quote Originally Posted by Tidder View Post
    Hey, as long as it's not any particular race I'm offending, I can stand to be a pedophile.
    All information expressed in this post is my opinion, and should not be regarded as a statement of fact.
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  6. #6
    Maximum Bitrate nasa's Avatar
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    slammedteg91,

    Your credit score is the 2nd most important number -- the first being the ratio between your gross income vs monthly payment. Lenders want that to be less than 41% (typically, those who don't are in real trouble right now -- infact most are going under).

    Your credit score will do 2 things - help you get the loan && help with the actual rate. To see what is actually on your credit report, take advantage of the law -- you are allowed 1 free credit report per year (and even more if you are denied credit). Use google and you will find a lot of companies offering you just this service. It's a good idea to review your credit report often -- as it can affect more than your ability to get a loan.

    Contrary to ODYSSEY's belief, a down payment is NOT necessary to get a morgage. It may save you money, however. If you don't have a down payment (of 20%) most lenders will want you to pay something called PMI. PMI sucks. It doesn't do anything for you the buyer, so avoid paying it if you can. One way to do so is an 80/20 split. I won't go in to a lesson on loans at 0230, but I suggest taking a little time to look at all the different loan types that are available.

    One more thing, when to buy. In general, owning a home is a better money move than renting. And at the moment, the housing market is down(ie: it's a buyer's market). That said, take a look at a rent vs buy calculator like this one:

    http://www.vlender.com/cgi-bin/calc/rent_vs_buy.cgi

    to account for your personal situation.

    If you have specific questions, I can try to field some of them. I end up doing the buying/selling thing every 3-5 years....


    Nasa

  7. #7
    Banned Motorcity's Avatar
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    Quote Originally Posted by mwmcginn View Post
    Where do you see that?
    did you read the OP's entire post???

  8. #8
    Banned Motorcity's Avatar
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    Quote Originally Posted by slammedteg91 View Post
    ......-$5000 personal loan (had a cosigner) I got last month to buy a car, assuming I pay that off fast (its a 5 year loan @ $102/month, so I'll throw down $300/month and have it paid off in around 2 years)

    I'm 19 almost 20...


    A car loan (I was approved without a cosigner for a $5000 car loan but didn't take it because I didn't want to pay full coverage insurance)? Thanks guys!
    ?

  9. #9
    Unregistered User ODYSSEY's Avatar
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    Quote Originally Posted by nasa View Post
    Your credit score will do 2 things - help you get the loan && help with the actual rate. To see what is actually on your credit report, take advantage of the law -- you are allowed 1 free credit report per year (and even more if you are denied credit). Use google and you will find a lot of companies offering you just this service. It's a good idea to review your credit report often -- as it can affect more than your ability to get a loan.
    Your free credit report does not include a fico score. The only place you can get a real fico score is http://www.myfico.com/ or from a lender. Any other site does not use the same formula and is only an estimate.

    Don't be fooled by all those fake free credit report websites. If you want to get your free report visit here - http://www.ftc.gov/bcp/conline/pubs/...eereports.shtm
    Contrary to ODYSSEY's belief, a down payment is NOT necessary to get a morgage. It may save you money, however. If you don't have a down payment (of 20%) most lenders will want you to pay something called PMI. PMI sucks. It doesn't do anything for you the buyer, so avoid paying it if you can. One way to do so is an 80/20 split. I won't go in to a lesson on loans at 0230, but I suggest taking a little time to look at all the different loan types that are available.
    I never said a down payment was necessary. Down payment can lower your interest rate and let your lender know you are serious. You have to pay PMI until you reach 20%.

    Also the days of 100% financing, interest only loans and creative financing are starting to come to an end (specially with lower credit people or first time buyers) since the housing market is heading downward.

    Another note, I suggest staying away from ARMs. Get a fixed rate loan, interest rates are going up.
    ODYSSEY

    Quote Originally Posted by Tidder View Post
    Hey, as long as it's not any particular race I'm offending, I can stand to be a pedophile.
    All information expressed in this post is my opinion, and should not be regarded as a statement of fact.
    Digital-Car UK|

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    (")_(")

  10. #10
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    Ok I really didn't explain the $5K loan thing that well, my mistake. I have a 91 integra hatch that needs some work, and I needed a new DD while I was fixing it (and also because the teg is lowered and sometimes isn't a comfortable ride, etc.). I got the $5K personal loan to buy my $3000 95 accord daily driver, used the rest to fix the teg (and I needed a new mattress), and still have $800 left which I am putting back on the loan (today actually I'm going to the bank to do it). Full coverage insurance is really expensive for me, about $420 a month if I wanted it (19 year old single male...) while for both cars I pay $180 liability a month. I do take a chance about it getting stolen or wrecked, you are right. But the $240 a month I save in insurance, after a year would almost pay for the car.

    And the cosigner/whole personal loan thing - obviously a car loan is secured (I don't pay, they come take my car). No cosigner would have been required. An unsecured personal loan is "harder" to get (and the cosigner was required for me in this case) because if I don't pay, what can they get from me? They don't have the title to my car (I do). Thats why it's a five year loan, it was all I could get approved for. But if I pay $300 a month on it (principle payments) and pay it off in two years, then I pay around 1/3 of the interest. That's how it was explained to me.


    Anyway, I am now done school so I am getting a second job at night so I can really start saving. I'm going to look into all the information you all told me. Thanks for the help!
    -Josh

    91 Acura Integra RS Hatch
    95 Honda Accord LX Sedan (daily driver)

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