Lemme preface this by saying I am not a mortgage broker/banker/loan originator/etc. THis is only heresay

Ok, so I sold my house years ago (right before the boom! )...anyways, I have been going back & forth to UK since. Now since we've decided to make a go of things here in the US, I've been back home trying to get things settled for his arrival. I've been VERY concerned about how we are going to qualify for a mortgage, but basically I've been ignoring asking someone about it, cos I didn't wanna hear the answer See, since I've been living overseas...I obvioulsy haven't worked in about 5 years. I just started working late last year. AND I'm self employed (could this get worse? ) Obviously, the point I'm trying to make is that on paper, we're not the strongest candidates for a home loan (me no job history, him no US credit)...which has always made me really anxious & stuff.

So anyways, I decided to talk to this guy I work with. He tells me that it doesn't matter about my work history because if I go 'stated'...they don't verify employment!!!!! You need a pretty decent credit score to go stated...like high 600's or so.

Now a foreign spouse isn't going to have any credit, and no it doesn't transfer over (I thought there was a way it might, but no such luck)...so D isn't going to be of any help whatsoever. BUT if you go 'stated' you can count your spouse's income as your own!

So if I make 50k and he makes 50k...I can say I make 100k and they will not verify this!

Hope this helps someone....or at least gives someone hope! I know it did for me!

Interesting. My broker never verified my income AFAIK. I dont recall hearing the term "Stated" before. Whatever works I guess.

The best thing to do in this situation is get pre-qualified before you go house hunting.

If you go the no-verify route, you have to have a stellar credit history. Hi 600's is probably not going to cut it on a no-verify. I would venture to guess it would have to be much stronger then other candidates because your SO will zero history. But then again, they will only take into account his history if you apply jointly.

Pre-qualifying costs nothing, so you can do that any time.

Stated or no-verification don't qualify for the same rates, typically.

And the high credit score is part of the deal.

Try the 700's. 600's? No way.

I work in the real estate field...I work with mtg co's all the time. There would be no reason to mislead me or give misinformation.

High 600s can qualify for stated income. Obviously it goes without saying that the better your credit, the better your interest rate. But there's no different a rate if you were to go stated than if you weren't. It's based on credit score. As for the foreign spouse, they wouldn't be actually on the loan, it'd be soley in the USC's name.

Perhaps each state is different...and since I'm not a mortgage broker, I can't dispute that what happens elsewhere might be different...but I am certainly capable of passing on what I was told by one.

Fyi, a pre-qual is not worth the paper it's written on....a pre-approval yes, but not a pre-qual. Prequals take 5 mins and only verify credit score...everything else goes by what the perspective buyer says to the mtg broker. A pre-approval requires formally applying....giving tax records, check stubs, etc.

I have worked with sooo many buyers who have been prequald and when it's crunch time, they've been turned down for every loan poss....

I tried to edit but for some reason it won't let me....I wanted to clarify that when I discussed that the interest rate would be the same...I mean in *my* case only. I cannot say across the board what one's rate would be...obviously I'm only interested in my own.

But seriously, I only posted this to possibly help someone else from hearing about a personal experience...not to get in a disagreement that what I'm saying isn't true. Like I said, I'm only relaying a personal experience only....

adding one more bit of vital info that I forgot to mention: I am not going for 100% financing.

just my two cents here, based on todays experience at the bank...

Just like ur fella, I havent got any credit score here, and no income since EAD hasnt happened yet. Still we took our chances and got pre-approved for a big chunk thanks to his good work and income. THey didnt ask for proof of income until it was crunchtime, and then a e-filed copy of his taxes did the trick.
We managed to put like nearly 40% down, so that was the luck we had, bank was just too darn pleased to not be at risk. As for it being financed by USC only, yep, we found out today that I def cant be on the loan agreement, and its likely I wouldnt even be on the Deeds for the house. Either way, hear say can sometimes be the best help... so I found out from personal experience. Oh and erm.... end of 600's is what mortgage broker told us when we went for pre-approval, she said anything in that area or above is excellent, then again, homechannel on TV keeps mentioning how bad score shouldnt be a prob, so what is it?

Anyhow, good luck with the househunting, hope u and ur guy find a nice one to start ur lives in it together

My dog could get a mortgage if he put 40% down

Hi,

We just bought a house, and were only able to finance it because we had over 20% as a down payment and I had a very good credit score (high 700's) My husband, the non-USC, had no credit history in the US and his income could not qualify on the mortgage-its all based on my income, and credit history. My job here doesn't pay very well, but because we bought a duplex and will be renting out the upper floor of our house, that rental income was counted in with my income, allowing us to be approved for a bigger loan, and buy the house we wanted. Luckily it all worked out, and we are now homeowners (and landlords!)

This is all very good info, thanks for posting the discussion.

Our situation is that I work, make only moderate income ( I clear the 125% of poverty level for our family size no problem), and last time I checked into my credit history/report it was half crummy, there were only 3 hits against it, and they were from 1998-1999, and none of it my fault. One of them I can/have handled, but its still on my report. I called these companies trying to clear it all, and the largest one was from a cell phone company bought out by Cingular who verified that my acct was in good standing since I opened it way back at the date in question. I could not get this removed from my credit report even though no one could prove the numbers/accounts in question on my credit report.

Is there a good way to go about clearing it all up before I try to apply for a home loan? My fiance (from UK, presently unemployed as we're getting married in 10 days) and I want to buy a house within a year or two, but I want to be able to qualify for as much as possible so we can shop in whatever range we can afford, not what the bank deems "affordable" to us.

Is there any way to convince a loan/mortgage company, with say 10% down or so, that the huge payments you make in rent every month would be a great house payment instead? I'd like to own a house so unlike rent, by the time its all said and done, I have something to show for the 1000 dollars I pay a month for a house to live in.

Any other advice for a soon to be homebuying noobie?

Well.. every situation is different. To start, you said these "dings" on your credit report are from 98-99. Once they reach the 7 year mark, you can go online and dispute them. By law, nothing over 7 years old can remain on your credit report if you don't want it there.

As far as putting 10% down, I would try another approach. I only had about 10% to put down as well, so I would have ended up paying PMI (Primary mortgage insurance - required by law in most states). Depending on the size of your loan, it could be quite a bit. In my case, if I didn't put down 20% my PMI would have been $480/month, on top of the mortgage and taxes. My broker recommended that I do an 80/20 loan. This is basically 100% financing in 2 loans, 1 for 80% and one for 20% and no PMI. I had the 10% left over that I would have used as a down payment to cover closing costs and buy furniture & stuff.

Like I said, every situation is different. The is the biggest purchase of most peoples lives. The best thing to do is to have a sit down with a good mortgage provider or a quality broker and work out all your options.

You can pay PMI upfront in one lump sum, then it's usually about 1%

And I dunno how they do it elsewhere, but in FL the last two years credit are what they are primarily interested in....

Damn.. it must be different in FL because if it was only 1% I would have gone down that route..

LOL fair enough, guess you got a point there...

may or may not help someone but we are working with a company in FL who works with many ex-pats for pre-approval and 2 months before we are due to fly he will work on that for us.

As we will be putting approx 70% down and my pension is already paid into my US bank account each month, he ssays we will have no trouble.

Thanks for all of the advice everyone.

I have nothing to add since we KNOW our credit sucks. We're waiting till the end of 2006 to start looking at purchasing a house, that way I'll have a year's worth of credit history and my hubby will have a year's worth of GOOD credit history. We're being very careful making bill payments on time or early, no "NO money down" deals, etc. This really sucks because I love plastic money and have never had to worry about my credit rating before. I still have my Canadian credit card though

Be careful, going with stated income doesn't mean you should make up a number for your income. There is always the possibility that the loan will be audited, in which case you may still need to show proof of that income. And stated/no doc loans will always cost a little more in interest rate than fully documented loans.

If your credit isn't crash hot, then often an FHA loan can be had, they generally go on your last two years of credit (on time bill payments etc). It's an alternate way of showing that you are worthy of monthly payments

The problem isn't the credit, the problem is a sparse work history...only since Sept of last year. I'm the USC, so I'm the one that 'matters' from the loan perspective, as he won't have US credit to qualify with me.

I would never make up numbers...but if he gets a job, then I can count his income with my own so we could also qualify for a nicer house.



Don't know if that's just a FL specific thing. I actually just learned this not too long ago when I went to see that financial guru Suze Orman speak. She never specified it was 'FL' only...she just said that everyone paying monthly PMI was stupid, cos they coulda paid it upfront, lol.

Seriously, she's a nasty piece of work, but was very infomative. She spoke to us with a bit of disdain like we were all lowlifes or summat....that was my whole group's take on her. We named her 'Cruella DeVille'

Dunno if you can switch it not, but I suppose it's worth looking into.

I'm not paying PMI because I went with an 80/20...

PMI was estimated to be $480 per month? That seems very high. Did you have a jumbo loan? FWIW my PMI is about $45 per month.

Of course you have no worries with your 80/20

Yes, over 500k..

Suze Orman is a moron. Her first book is called "Suze Orman's Financial Freedom".

My interpretation of the title is that financial freedom is what she now has since she snowballed herself into an expert.

Just wanted to share our home buying experience...

I think it's easier for immigrants to the US to establish credit than some people think. We have found zero difficulty in establishing a good credit score for Sujeet who has been in the US less than 2 years. It all started when I added him as a card holder/authorized user on my 2 credit cards, and it did make an impact. That was while he was still in India, and here in the US I'd get credit card pre-approvals sent to my house for him! I thought it was funny since he wasn't even in the country yet. So after he arrived here, he opened a credit card with a low apr, and started charging small amounts, then paying them off in a month, and etc. Now he has a good credit score.

We got many pre-approvals for a mortgage even though he only had about 1 year work experience in the US so far. And Sujeet did all the investigation for mortgages in his name, not in mine (I'm the USC). I have an even better credit score than Sujeet and I am the co-borrower for the loan, but Sujeet is the main borrower, who is not the USC and has not been working here 2 years. Sujeet makes a decent salary and that is one reason they say it's ok, they only asked what career he had in India before coming here. Also, we are going through the first time home buyers program, which is giving us a low APR of 5.59 fixed 30yr rate.
My advice to anyone who has good credit in the US...and if you have credit cards(and are responsible with them!), add your spouse/fiance as an authorized card holder even before you start the visa process and before they are in the country. It did make a big impact for Sujeet's credit.

Wow.. 5.59 fixed is an amazing rate! Did you get that recently? And through which bank if you dont mind me asking.

The rate is so good because we are doing the "first time home buyers program" here in Florida. We are going through American Home Mortgage(there's a local office here). I don't remember the name of the bank, I don't have the details at hand. But because of it being a first time home buyer program, the interest rate is low. You have to make less than a certain amount to qualify. In our county, you can't make more than $53,000 per year. This is info about it:


Florida Housing recently made $77 million available statewide in low-interest mortgages for first time homebuyers at a 30-year fixed interest rate of 5.59%. Eligible applicants could receive down payment and closing cost assistance in an amount up to $25,000 in certain high cost counties. Teachers, firefighters, healthcare workers, police officers and veterans could be eligible for a lower interest rate of 5.19% through the Community Spot Loan. Florida Housing has set aside approximately $7.5 million for the Community Spot Loan.

Review the First Time Homebuyer Brochure and other program information on this website then contact one of our participating lenders to determine if you’re eligible. You could be on your way to homeownership!


First Time Homebuyer Program

Florida Housing’s First Time Homebuyer Program provides low interest, fixed rate loans at 5.59% and down payment and closing cost assistance to eligible first time homebuyers purchasing new or existing homes.

The proceeds from the sale of both taxable and tax-exempt single family mortgage revenue bonds are used to finance these 30-year, fixed rate mortgages for low to moderate income homebuyers. In addition to providing low-interest rate loans, this program also offers credit counseling resources and deep subsidy second mortgages.

Eligible applicants include individuals who don't own their current home, don't claim their mobile home as real property, haven't owned a home within the past three years, have established credit worthiness, and have an annual income that does not exceed program limits. To request a brochure, call us toll free at (888) 447-2977 or download the brochure below. To search for participating lenders in your area, select the List of Participating Lenders link on the left.

Stina, that credit info that you shared is great to know! thanks so much for sharing.

It scares the living crap outta me that it's all gonna be on me to get us a house, or wait 2 years, so I'm going to start adding D to my stuff now....great idea, thanks!

Our problem is not being able to get credit, but more the insanely high prices here. It's more economical to rent rather than buy.

Interesting thread.

Can I bump this with a few related questions about buying a house in general?

How do you figure out how much "house" you can afford to buy?
What's the process like?
I hear you need to get pre-approved for a mortgage first and then.. what happens?
I have like no clue whatsoever, I've lived with my parents and then rented a dorm room and now D. and I are living in an apartment.

D.'s worried about how expensive houses are but right now with our pay raises over the last year, we're making a bunch more than we were and I'm thinking it's about time to look into having a place of our own.
His dad owns a concrete/building company and they have a few houses on the market or whatever that they're trying to sell so they can still make a profit out of and his dad showed him the houses but D. got the feeling that his dad was trying to hard to sell one to us. (I think they build like basements for people's houses but these got foreclosed and the bank is trying to get rid of 'em so they can pay the company for the building costs)


Yeah sorry for the rambling. I guess I'm just wondering about what the process involves and how much money we should have saved beforehand and maybe first time buyers deals and such?

Thanks a bunch if you read all this

We just closed on our first Condo last friday... our mortgage is in my name (non-usc) with my husband as co-borrower as he cant work because his is disabled... we had no problems getting a good mortgage and we went with a first time buyers programme.. 100% at 6.2% fixed.. we did get pre-approved as this saved a lot of time once we had found the condo we wanted... it only took us 4 weeks from initial offer to closing...

Good Luck to all who are house hunting.

Kez

If anyone in the North East is looking for a good Broker just PM and I will send you the details...

Wanna say first of all that I was mistaken when I made this first post, and going stated is not at the same rate as verifying. Duh. I was misinformed...sorry guys! Turns out it would be like an extra point on the rate :/

As I've said, I'm not a lender so I was only relaying information given to me at the time....



Well first figure out how much house you NEED (not want, but need) then go to an agent and look at what those are going for. You might also decide to look into fixer uppers if you're handy. But knowing what the mkt in your area is like is crucial. Sometimes it works out that first time home buyers get exactly what they WANT but other times, they have to lower their expectations just to get into the housing market.


The agent that you go to would most probably have contacts with lenders he/she works with. Or you could try your own bank. A pre-qualification and a pre-approval are two different things: a pre-qual only goes off what you say; ie 'I make x amt'. Nothing is verified but your credit score. It can be done over the phone. The lender would then give you a letter saying 'based upon information, yadda yadda yadda'

A pre-approval is what you want to go for. It's a formal application for a loan. The lender will ask for pay stubs, tax returns, bank statements, etc. It's nowhere near as quick as a pre-qual, but it's more solid. Be sure you are dealing with a reputable mtg co.

This is where you should be talking about rates, payments, etc. You can ask the mtg co or bank to break it down so that you can buy a house based on not going over a certain figure for monthly payment. Then you will see all the options presented to you...what programs are available, how much of your own $$$ is reqd, etc. Here in FL, you can shop around for a mtg for a certain length of time....ie...several lenders could pull your credit and it won't lower the score. Check with your own state and lender for the time frame if you want to shop around for the best rate.

You should also check into the taxes and how much they will be once you buy a home and the home's value is reassessed. Here in FL there's a 'save our homes' amendment which says that taxes on your home (I believe it's only for homesteaded homes btw) will only go up a minimal % each year.. So theoretically, if someone was living in a home for like 20 years that they bought for hardly nothing....then they sell it for fair mkt value....sometimes the taxes can more than triple. Because the home will be reassessed once you buy it. I know lots of customers here in FL go 'oh look, they only pay $600 a year for taxes' and I'm all 'yeah, but they've lived in the home for 40 years' You can check with the county and get a clearer picture with them. The lender can estimate taxes, but again...it's an estimation.....so my personal theory is to go to the person who really knows the best....and that would be the property tax appraiser.



Also, anyone planning to buy a home in the not too distant future should also be concerned with their financial health....pay off credit cards, save as much money as possible, and don't make any large purchases...ie a car with payments. If you're not ready to buy right now...you could ask your lender for tips on what you can do to make your financial health better for when you are ready.

I keep wanting to stress that I am not a mtg broker or a lender....this is just ancedotal information which might help point ppl in the right direction to speak to those who are qualified and licensed in your state to help you.

Good luck everyone!

Just been reading the thread, and I thought I'd post my concern here.

My fiance has been umemployed for a long time, and I'm assuming here credit score isnt that either. What chance will we have of buying a house over time, when I move to Florida to be with her and I am earning. Assume I have an average job and my income would be the majority of our overall wage together. Is buying a house going to be virtually impossible because I have no credit score?

^ Assuming once I've worked for a while and saved money etc....I really just need to know how difficult it would be establishing enough credit to qualify for a mortgage.

Thanks Lisa!

Unemployment doesn't affect the credit score. Not paying your bills does. If she has kept things current her credit won't be harmed in anyway.

I am a USC, my husband is UK citizen.

I bought a house in May 2006 based on my credit/income (did the 80/20 thing that someone else has mentioned here). The note and mortgage are of course in my name, as was the original deed. After closing, I just drew up another deed (it's nice being a paralegal) wherein I conveyed one-half of my interest in the house to my husband.


Denise

That's helpful to know. How long do you need to have a US credit card for to establish credit?

"Establishing credit" is a bit vague. It will take more than one credit card to have built a file upon which a mortgage lender will make a decision.

However, one credit card, used wisely, should allow you to do some other borrowing. Done wisely and conservatively, you can build a file nicely.

I've often felt that purchasing some furniture for your home, or entertainment equipment, or some of those other short-term financing options are good ways for those with little or no credit to get started. The interest rate on this type of financing is usually high, so a smart plan of action would be to take the financing and keep it open long enough to show a good payment pattern and then pay it off early. Say in 6 months or so.