30/70 Rule?

[investinAK]

I have heard about mortgage companies doing loans for people with bad credit if they put 30% down. Is this an urban legend? I can see where this may be true due to the fact that you are putting a lot more at risk than say a 0 down, or even a 10% down loan. I am mainly interested in this for the purchase of my own personal home in the coming year, rather than for investment purposes, as I have BAD credit!! Thanks!

[LvgonaDream]

Do you have a copy of your credit report and have you tried fixing your credit?

I always assumed I had bad credit because a broker we refi'ed with back in 1995 told me I did. He had also told me that he had to up the interest because the back we were refinancing from had us in foreclosure. We had excellent credit at that time - course I find this out a day late and a dollar short. He did this merely to make more money for himself and so now I DO have bad credit after trying to pay that ridiculously high mortgage!

I've recently been trying to fix ours - and seemingly succeeding as we are getting better offers in the mail, but I'm not done sending out all of my "fix it" letters yet, so waiting to get new reports.

After researching a ton of sites, I really liked this one http://mix6.com/credit - altho this site says to dispute one debt at a time, I did mine in one letter and did not have a problem at all. They also have a yahoo group where you can ask specific questions and, like here, they are a great bunch of helpful people. Good luck!

[investinAK]

Yeah, I just recently got a copy of my credit report, and it is definitely in the bottom sector of credit. (below 600 above 500)

That is on of my first, and main goals through investing, is to pay off some of my debts, and get my credit card to below 30% of my limit, and what not. I had a period about a year ago, where I had just bought a brand new car, then I lost my "secure" job, so then I lost my car. Goes to show you the "TRUE" loyalty in corporate America! I thought my job was as secure as the pentagon....

[Aldo]

Things may not be as gloomy as you imagine. Your credit history will make things a bit more difficult, but not at all impossible. The redeeming factor is that you are purchasing a personal residence which makes a huge difference. Mortgage money is still freely flowing due to the current competition between banks. A friend is a mortgage broker and recently found a mortgage for the following: A single male, early 20's, unemployed (but recently started his own business), and had a judgement and two collections on his credit report. I wouldn't rent to this guy and he got a mortgage.

I would strongly advise doing some research on ways to improve your credit score and find out which methods will produce the quickest results. Bear in mind that credit reports are updated every 90 days. Depending where you are in that cycle, it could take as long as 4-5 months to see a change in your rating.