Is less than perfect credit better than no credit.?
Seems like it is . People who had short sales can buy in a couple of years and people whose credit score is less than 650 can also buy a house but I have found that someone with No Credit has to wait to establish credit.
If you pay cash for all your purchases or use a debit card it does not count. I am dealing with one such case right now.
The real estate market has changed a lot in last five years. The lending institutions went from giving mortgages to almost anyone who applied for a mortgage to denying it to almost half the applicants.
There are many banks that have stopped lending for condo purchases.
The few banks that lend for condos have the condo questionnaire required by Fannie Mae or Fha and then turn it down based on investor ratios, hoa dues delinquencies and many other reasons.
I had a settlement last month where I had to look for the U and O for the entire building and they also wanted a structural engineer's ceritificate . I am glad it settled and I have happy clients.
I have a buyer who qualifies based on income but has no credit . The score comes up as NA.
They used to be able to get alternate forms of credit like utility bills and rent checks but not now.
I am sure there are some investors who will lend but they are not easy to find.
In order for the Condo market to improve lenders have to start lending and not have strict guidelines otherwise we may never fully recover from the housing crisis.
If you were an investor who has money to lend who would you prefer .....? Let us say that there is a buyer buying a house for $100k, is putting down $3500 and has been late on a few bill payments and has a score of 660 and making barely enough to qualify for the mortgage
and there is another buyer making more than amount required to qualify for mortgage, does not owe anyone any money and pays all bills on time and is putting down $20,000
Can you guess the answer ?
I am not a mortgage professional. Consumers should sit down with a lender and get pre qualified and ask for answers relating to mortgage.
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