Anonymous wrote:

Anonymous wrote:

Anonymous wrote:From what to what did your credit score go to? Do you have defaults/liens on your credit or just late payments?

765 to 710 and 700 to 650. No liens. One of us had a student loan go into default, but it’s out of default now (as of 5 months ago) and payments are current. We also have two credit cards through same credit union. While we maxed those out during the unemployment period, we were never late with a payment and both are now at about 70% credit utilization and we’d pay them off with sale of our house.

Credit utilization matters in how your credit score is calculated. The credit card payment matters in how much DTI you're allowed. If you plan on paying off the credit cards with the house sale, it may not help you much with the new loan because it takes a month to hit your credit report (that it's paid off). You might be able to get a letter from the credit cards saying they're now paid off which the loan officers could use to help calculate the new DTI though. Honestly, just call one of the big banks. Tell them you don't want them to run your credit report and you're just trying to figure out if it makes sense for you to buy now or not. They should be able to give you a reasonably accurate loan estimate.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:From what to what did your credit score go to? Do you have defaults/liens on your credit or just late payments?

765 to 710 and 700 to 650. No liens. One of us had a student loan go into default, but it’s out of default now (as of 5 months ago) and payments are current. We also have two credit cards through same credit union. While we maxed those out during the unemployment period, we were never late with a payment and both are now at about 70% credit utilization and we’d pay them off with sale of our house.

Credit utilization matters in how your credit score is calculated. The credit card payment matters in how much DTI you're allowed. If you plan on paying off the credit cards with the house sale, it may not help you much with the new loan because it takes a month to hit your credit report (that it's paid off). You might be able to get a letter from the credit cards saying they're now paid off which the loan officers could use to help calculate the new DTI though. Honestly, just call one of the big banks. Tell them you don't want them to run your credit report and you're just trying to figure out if it makes sense for you to buy now or not. They should be able to give you a reasonably accurate loan estimate.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:From what to what did your credit score go to? Do you have defaults/liens on your credit or just late payments?

765 to 710 and 700 to 650. No liens. One of us had a student loan go into default, but it’s out of default now (as of 5 months ago) and payments are current. We also have two credit cards through same credit union. While we maxed those out during the unemployment period, we were never late with a payment and both are now at about 70% credit utilization and we’d pay them off with sale of our house.

Credit utilization matters in how your credit score is calculated. The credit card payment matters in how much DTI you're allowed. If you plan on paying off the credit cards with the house sale, it may not help you much with the new loan because it takes a month to hit your credit report (that it's paid off). You might be able to get a letter from the credit cards saying they're now paid off which the loan officers could use to help calculate the new DTI though. Honestly, just call one of the big banks. Tell them you don't want them to run your credit report and you're just trying to figure out if it makes sense for you to buy now or not. They should be able to give you a reasonably accurate loan estimate.

Honestly I think OP would be fine if they just slowed it down a bit. Take the $400K and pay off the debt. Rent for six months and then apply for the home loan. Your credit report will show a low to negligible DTI ratio and with no liens or major defaults, you should be golden.

The only question is will the banks have a problem with giving you such a larger mortgage. You'll have to show that your HHI can handle a $1M property with I'm assuming at least a $200,000 down payment once your debts are cleared.

Anonymous wrote:We need to sell our house and move to another for proximity to our jobs. We’ve been in our current house for more than 10 years and have a perfect mortgage history with our credit union lender. Unfortunately, due to a long period of unemployment that ended 6 months ago, our credit is not good. Even though we were never late with the mortgage and have caught up on all other debts, including paying off some medical debts we incurred, our credit is not bouncing back very quickly. By selling the house we’re in, we will be able to pay 30-40% of the purchase price for a new home but will need a mortgage to cover the rest. Given our established good history with the credit union that holds our current mortgage, are we likely to be able to get the mortgage we need to buy a new house after selling ours? Secondarily, are we more likely to get the mortgage we need if we sell ours first and then apply for preapproval or can we go ahead and apply for preapproval so we can buy/sell almost simultaneously?

I think it would take a couple of years for our credit scores to creep back up to where they were, and we just can’t stay where we are that long. We each have a nightmare commute and would really like to move at the beginning of summer.

InAndOut wrote:

Anonymous wrote:We need to sell our house and move to another for proximity to our jobs. We’ve been in our current house for more than 10 years and have a perfect mortgage history with our credit union lender. Unfortunately, due to a long period of unemployment that ended 6 months ago, our credit is not good. Even though we were never late with the mortgage and have caught up on all other debts, including paying off some medical debts we incurred, our credit is not bouncing back very quickly. By selling the house we’re in, we will be able to pay 30-40% of the purchase price for a new home but will need a mortgage to cover the rest. Given our established good history with the credit union that holds our current mortgage, are we likely to be able to get the mortgage we need to buy a new house after selling ours? Secondarily, are we more likely to get the mortgage we need if we sell ours first and then apply for preapproval or can we go ahead and apply for preapproval so we can buy/sell almost simultaneously?

I think it would take a couple of years for our credit scores to creep back up to where they were, and we just can’t stay where we are that long. We each have a nightmare commute and would really like to move at the beginning of summer.

With 40% down, you will find many eager lenders, even with a bruised credit score.