first time home buyer...where do i start?

[stylin1230]

i would like to buy a home in the next yr and a half,i had my credit pulled a few months back by a mortgage lender i found on line...american morgage...and she told me my scores were too low to give me a loan and i needed to get my scores up in the mid 600s and chip away at the debt i have,which i dont think is that much.so i started coming to this website and cleaning up my credit.i got most of my fako scores in the 620s and my ficos are in the 610 to the 620 range.well 2 weeks ago i bought myself a new car it is financed thru gmac financial and i got a 10.7% interest rate.i think thats pretty good right?anyway so my question is what is my next step toward owning a home?i have 2 new tradelines on my credit being the car and a ballys acct,some one told me the car i bought will hinder me from getting a mortagage now,is this true as well?someone please give me advice about what i need to do now to buy a home.im lost.thank you

[goodkiller]

Originally Posted by stylin1230

i would like to buy a home in the next yr and a half,i had my credit pulled a few months back by a mortgage lender i found on line...american morgage...and she told me my scores were too low to give me a loan and i needed to get my scores up in the mid 600s and chip away at the debt i have,which i dont think is that much.so i started coming to this website and cleaning up my credit.i got most of my fako scores in the 620s and my ficos are in the 610 to the 620 range.well 2 weeks ago i bought myself a new car it is financed thru gmac financial and i got a 10.7% interest rate.i think thats pretty good right?anyway so my question is what is my next step toward owning a home?i have 2 new tradelines on my credit being the car and a ballys acct,some one told me the car i bought will hinder me from getting a mortagage now,is this true as well?someone please give me advice about what i need to do now to buy a home.im lost.thank you

Yes, 10.7 is great for FICOs in the the 610-620 range. (perhaps look into refinancing after 6 months if your CR's are even cleaner and your FICOs are much higher

As far as the new car loan hindering your mortgage opportunities, the general rule of thumb is to not open ANY TLs if you are preparing to apply for a mortgage, so, yes, the new car loan violates this rule. You want your CR to be as shiny as possible when a mortgage lender looks at it. (Do you really want to risk adding higher percentage rates to a 30 year loan? A 1% rate difference can cost you $50K or more)

Here's a decent checklist blog from a mortgage broker that has some good suggestions for what to do to prepare yourself for your mortgage hunt. http://mtmahoney.blogspot.com/

[stylin1230]

so have i totally ruined my chances of buying a home?how long should i wait before i try to buy a home and what can i do right now to get ready?

[goodkiller]

Originally Posted by stylin1230

so have i totally ruined my chances of buying a home?how long should i wait before i try to buy a home and what can i do right now to get ready?

I didn't say that. Read over that link I provided, as that will give you a lot of good "pre-mortgage application" info. I have no idea what your chances are, as I don't know what's in your CR and what your financial situation is. You can apply for a mortgage anytime you want, but it's typical to add NO new tradelines to your CRs at least 6 months prior to applying for a mortgage. If you can wait 6 months, your auto loan will age a bit and look better to a lender, but again, I am not telling you not to, I am just trying to steer you in the right direction.

[TScott]

Originally Posted by stylin1230

so have i totally ruined my chances of buying a home?how long should i wait before i try to buy a home and what can i do right now to get ready?

You should also try reading the Mortgage Forum on creditboards.com. There are some professionals on there that can help you too if you have specific questions.

BTW, GK........That was a great link.......Thanks.

[goodkiller]

Originally Posted by TScott

BTW, GK........That was a great link.......Thanks.

I RULE!

[Ally]

There are all sorts of mortgage options available for people that need financing.

Have you spoke with a loan officer/banker yet? They'll be able to have a look at what's going on and offer you some options.

[bobbyc99]

The general rule is no tradelines 6 months prior to applying for a mortgage. The main problem you will have with this car is debt to income. Did you trade a car in to get this one? If you traded a car in that you were making payments on , it may not hurt your debt to income as it should be about the same.
Not to worry though, your scores are high enough to qualify for a mortgage. Good Luck.