Can I qualify for a mortgage for a home about 160k and my credit score is about 540?

Question

My husband and I would like to buy a home but our credit is horrible. Our combined income is about 110,000 dollars. My husband has lein on him from the irs for owing back income taxes. I was thinking about buying a home in my name only. My income is about 50,000 dollars. My problem is this we have two car payments and both car payments are in both our names. How ill this effect me qualifying for a mortgage by myself. This would be my first home, I am so tired of renting. Is there any programs that can help me? The price range of the homes that I have been looking at are around 160,000. I appreciate anyone's advice.

Answer 1

You biggest issue (other than credit score) is debt to income. 2 car payments is a huge hit on 50k on a year (if you buy alone) Plus any credit cards, personal loans, etc you may have. That could make your 50k available yearly income drop to 30k or less.

So, first figure out your debt to income.

Then look at whatever savings you can apply as a down payment. (typically, 20-25% is required down for borrwers with bad credit)

Then after finding out debt to income, look at a mortgage calculator, that'll help you approximate how much of a loan you can get.

Answer 2

Basically and sorry to say you will not qualify in todays market.

Answer 3

It really depends on how much more debt you have. I think you may be a little strapped with your debt ratio.

Answer 4

Step one: Clean up your credit!

Go to http://www.myfico.com choose Suzy Orman's program...it will check your credit (no negative impact -soft hit) and give you advice on what to do to fix.

The program will show you what will happen if you take each advice it provides....like pay off a bad credit card could increase your FICO by 50 points.

After a 6 mos or a year of this medicine, you should be on track to qualifying for a house!

After you get your score up...go to bankrate.com for the best rates!

Answer 5

If you are in a community property state you can not buy without your husband.

Your husband can not buy until he repays the American public the taxes.

Even in a non-community property state 50k is not enough to qualify for a loan of 160k, even with good credit.

You do not pay your taxes and you are looking for tax money to buy you a house?!!

Please, move to another country.

Answer 6

Your income isn't too bad - 50K.  The main factors against you are an icky credit score and looks like a high debt to income ratio.  Lenders hate both.  

How much did you plan to finance?  You say that you are looking at homes in the 160K range, but didn't say how much you wanted to borrow.  If your LTV (loan to value) is 100%, meaning home costs $160K and you finance all of it, forget it with your situation.  If you put a substantial amount of money down, (at least 20% - honestly, you will need to put down more), you MAY (and that's iffy) be able to get help.  The market is tough for mortgages.  All those funky loans are a thing of the past and you have to have almost perfect credit to get anywhere in the mortgage field now.  

Your husband really needs to take care of the IRS tax lien.  Those don't go away and its affecting you as a couple financially.  You can't use his income to qualify for any substantial purchase.  Maybe you should focus on taking care of the IRS lien first and then begin looking for a home.