[armywife]

In short- my mom (only 58) is planning on selling her house (too big to take care of, she lives alone) She would like to purchase a home with my husband and our kids. An In-law. Currently, we rent our home. We have never owned a home or even attempted to. We were always concerned that we would never get a loan. My credit score is 690 my husbands is 650...neither of us have BAD credit, however we do have some unflattering issues. I don't believe these issues will be looked at too harshly since of all my loans (credit cards,car loan) I have never been late paying on them. Its more about the fact that our cards are usually maxed out. But we still make the payments and we usually pay double the minimum. What concerns me about being approoved is our employment history. I have been at my job for 15 months-however the company I work for I have been under their 'Name" for the last 6 years-I just moved to a different division of the company (however it is a seperate pay roll) I"m not sure if this would have any bearing what so ever on my history. Another thing is my husband just started his new job in May. Prior to that he was deployed out of country (National Guard), prior to that he had been in construction working odd jobs here and there but nothing really stable. So, his employment is splotchy (aside from the military which he has been "employed" with for over 14 years.) Would his military history have any bearing on his history of employment? Since he has only been on the job for a month will his time served in military help him out? The situation that my mom is in, and the fact that we found a house that we want is giving us little time to 'fix' things or build up employment. We want this now not later. The house is a HUGE fixer upper (no kitchen/bathroom etc...) so there is no way the VA is going to approve us getting a loan for it. I will be looking into it of course through a bank...my sister in law is a real estate agent and is the assistant branch manager at a small town bank...so I will end up applying and so on...but I'm just curious now about what other peoples' thoughts are on the info I have given...from people who actually have a good understanding about loans and mortgages (because I don't). My husband is very worreid we won't be able to and therefore he just doesn't want to try-but I say-whats the harm in trying...the worst that can happen is...we don't get a loan!well heres' why we want the house. It sits on 1.18 acres of land. And the cost is $195,000...ridiculously low for the Boston area. My husband and I can't afford to buy a house above $260 say (and thats even too high) and in our area...we'd be getting crap for that amount....might as well buy a house that has decent property. My mom would be using the money she makes from her home to help us fix it (if we can get it) I would love to buy a "better" home, but its just not possible. The homes around here are still in the 450-500 range (if you want something decent) And like I said, we're looking for a home with potential in-law...

[Jay P]

I'd be a little careful here. People get into trouble when they buy with their hearts and not their heads. Specifically, you said that you wanted this now not later. When you think like that, you often rush into financial commitments that don't make sense and buy the wrong property. With the real estate market where it is right now, why buy a fixer upper? Prices are as low as they have been in years and rates are darn near the same. If you can afford to fix up a house, you can afford a better home that has a kitchen a bathroom.Regarding your loan, there are a couple of things working for and against you. Your employment histories are fine. The bank wil understand your change in payroll and your husband's military service will be view favorably. The first issue is the FICO score. Even though you have not paid anything late, scores in the 600 range are not going to help with the loan process. Although you have paid all of your bills on time, you are maxed out of your credit. A large part of the FICO score is the debt to credit ratio. Basically, how much of your credit are you using. As banks view you as worthy risks, they raise your available credit. Mortgage lenders will likely ask why they have not raised yours. If they have raised them and you max out to the new limit, the bank will ask why can't you live within your means? Both of these will make a bank think twice about lending you money.I agree that it is worth trying, but remember, buy with your head. Renting is not the end of the world. In fact it is generally cheaper on a cash flow basis. Find the right house at the right time.

[RachelJBS]

My husband is also ARNG and we're in a similar situation - credit scores under 700, odd jobs for him, and the properties we can afford are all fixer-uppers that probably won't qualify for a VA loan. I'm a financial planner, so I've tried to step back from the emotions of buying our first home and look at whether or not it's actually a good idea/investment for us right now. We've made an offer on a place in southern NH, also a fixer-upper, and we're not sure if we'll be able to get financing for it. We're going to talk to the mortgage broker tomorrow. Feel free to email me and I can let you know what additional info I find out: racheljbrown(at)hotmail.comEverything Jay P said was correct: you should be looking with your head, not your heart. Even if it's only $195k in the Boston area, you're still going to need funds to fix it up, and you're going to need the time to fix it up too, which means renting for a few more months. I know it seems that now is the time to buy, but actually, there are many more adjustable rate mortgages (ARMs) out there that will adjust this year and next, meaning another wave of foreclosures and another wave of bargain properties. Or how about looking in different areas? Are you tied down to one place? I know you can find a really nice place in southern NH for $195k or less, and it's about a 1 hour commute to most of the Boston area. (I did the commute for a year and it wasn't so bad if you take the train or bus.)You might as well continue to try to get the house if you're already in the process. If you don't get the house this time, don't give up. You'll probably find something better in the next year or two! Maybe you'll find something better that is VA financeable and still in your price range.