Financing a Home with a 550 mid score

zlutz1 · November 6, 2006, 4:39pm

Hi, I was wondering if it is possible to get 100% financing on a owner occupied home in illinois , with seller concessions. With a 550 mid fico . And how fast is the closing time? Thanks

liverichly · November 6, 2006, 7:51pm

FHA essentially offers 100% financing, and has no score requirement.

For sub-prime financing a 580 score is the minimum required nowadays for 100% financing, but a 600 score is recommended. If you have a difficult time documenting income and need to do a stated income documentation type, a 640 score is the sub-prime industry standard for 100% financing.

FHA loans take a little while to close, so figure about a month. Sub-prime loans can close in as little as a few days from submission to funding.

Theapprentice · November 7, 2006, 1:44am

I am in the processing of starting a company to buy houses and flip them. I am using a company I’m starting (no more waiting and being nervous), but…

I have a credit score of 551 does anyone know where I can go?

christopher_w · November 8, 2006, 4:27pm

You might try using a non-prime lender first lien along with a small seller second lien. Argent will go to 100% CLTV even on non-owner.

liverichly · November 8, 2006, 6:43pm

Shhhhh… don’t let any secrets out, big no no. :

christopher_w · November 8, 2006, 6:52pm

Shhhhh! Be vewy vewy quiet…We are hunting woans.

Theapprentice · November 8, 2006, 8:05pm

Where can you go with a 550 for 100%. Please share the knowledge I even have a realtor! This could be good ;D

liverichly · November 8, 2006, 8:26pm

Perhaps the person who got their post deleted will come back and share their knowledge.

christopher_w · November 8, 2006, 9:10pm

The post that was deleted stated that the broker had a program where FICO was not important. Which is really scary. Either someone is desperate for business or they have “family” connections. Option One will do 100% LTV with a 570 and and First Consolidated will do a combo 80/20 down to a 530. Rate on the first is 11.99% and rate on the second is 14.49%. Thanks to Scott Miller for that tip.

Theapprentice · November 9, 2006, 2:04am

Thanks this is VERY helpful! I am starting my LLC as I write (in adobe). ;D

'Preciate Chris!

zlutz1 · November 9, 2006, 4:29am

does first consolidated do loans in all 50 states? or at least illinois and how can I get in touch with a rep for them? thanks

mjpeake · November 10, 2006, 2:56pm

I can do a 97% first with a 3k max 2nd, no minimum fico score, no more than two 30 day lates in the last 12 months. Lender paid MI.

realnew · November 10, 2006, 3:54pm

So how long after you close on these 12%, poor -Fico -score loans, can you

1.refi to a ‘normal’ interest rate ?

2 what are the estimated closing costs?

can the refi costs be rolled into the loan?

these posts are interesting to me. I’ve simmered for about a year now repairing my credit and becoming debt free. I’ll be interested in your answers.

mjpeake · November 10, 2006, 4:27pm

So how long after you close on these 12%, poor -Fico -score loans, can you
1.refi to a ‘normal’ interest rate ?

2 what are the estimated closing costs?

can the refi costs be rolled into the loan?

these posts are interesting to me. I’ve simmered for about a year now repairing my credit and becoming debt free. I’ll be interested in your answers.

Since there is no prepayment penalty on the loan, you can refi whenever you want, but the rate on that program is at 6.25% right now, so you probably won’t need to refi right away.
estimated closing costs are probably about $2500 (normal lender and title co cc’s) depending on loan amt (no dicsount points needed to be paid to get that rate)…cash to close can come from seller paid, borrower cash, secured or unsecured loans, or credit card. Borrower is only required to privide a minimum investment from their own money of $500 or 1% of the balance, whichever is higher.
Refi costs can be rolled into the loan.

Also, if the home is a rehab, you can go up to 120% tltv

There are income limitations, and borrower must occupy the property, and cannot own any other properties at the time of application unless it is a result of an inheritence or joint ownership with another family member.

All in all, it is a great program for first time homebuyers with dinged credit and little cash to close.

christopher_w · November 10, 2006, 7:33pm

MJ,
Is that an in-house product you are talking about? No minimum FICO seems a bit strange. Especially with a low rate like that. Sounds a bit like FHA. I’m not saying it does not exist, just that is seems like a strange product. Please advise.

mjpeake · November 10, 2006, 9:24pm

It is an in-house program, but is totally legit. Everything I stated before is fact. In my opinion it’s a better program than FHA. At least until FHA goes 100% ltv which I hear is right around the corner. Even then, the product I described is lender paid MI, verses FHA who will always have their upfront MIP.

christopher_w · November 10, 2006, 9:37pm

That sounds awesome. When I started out at Bank of america we had a product like this called ACORN and it what similar to what you are describing. Very cool. I would be selling that all day long.

mjpeake · November 10, 2006, 9:55pm

It’s one of my most popular products, especially with the market being geared to first time homeowners.

Theapprentice · November 10, 2006, 11:00pm

I need an N/O/O purchase for (improvements then a sale and/or for wholesale). What do you need for that?

mjpeake · November 10, 2006, 11:05pm

I need an N/O/O purchase for (improvements then a sale and/or for wholesale). What do you need for that?

I need to know alot. I will send you a private message with a list of some of the standard items I’d need to know…