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12-10-2012 at 12:37 PM
kimberlygo...
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kimberlygorski is not online. Last active: 01-23-2013, 8:38 AMNewbie

Student Loan Woes

I have a question that has been plaguing me for some time. I can't seem to find a real answer to it, so hopefully someone here has some experience and wisdom to offer.

I have a pretty good credit score. It's between 680 and 720 depending on agency. I have a long history with my credit cards and I don't have a lot of hits on my report. I have also, finally, paid off my credit cards, and don't have any other major debt to speak of with the exception of my student loans, which are in excess of $100,000. My credit score's biggest problem is that I have so many installment loans open from school. I wanted to buy a car with this same credit score last year and I was denied. It was certainly because of my obnoxious loan debt.

My husband and I desperately want to buy a house soon. We expect to have a sizable down-payment within the next year and a half. What are my chances of being approved for a home loan under these circumstances?

 
12-10-2012 at 1:55 PM
MommyLiber...
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MommyLiberty5013 is not online. Last active: 05-25-2013, 9:22 AMSilver
There are several factors that go into mortgage loan approvals. Probably the biggest is ability to repay...the lenders look at your and your DH's income in detail. And, they calculate your debt to income (DTI) ratio, which is a comparison of what you owe (debt-wise and would include the new loan) to what you earn. The other thing they would heavily focus on is the contents of your (and your DH's) credit report. The scoare plays a role, although it's not as great as the report itself. Other things to consider are DH's credit reports and your combined incomes. It's really too hard to give you a straight "yes" or "no" answer. The only thing you can do is try and see what happens. A sizeable down payment will definitely work in your favor. Also, SLs would be perceived better (kind of a "more responsible" sort of debt so to speak) than credit card debts, so it's good that you got those paid off.
 
12-10-2012 at 3:02 PM
smerka
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smerka is not online. Last active: 05-25-2013, 10:15 AMBronze
I would call your bank and talk to the mortgage dept and see what they say.  Starting a relationship with a bank now could help a ton too.

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12-10-2012 at 8:55 PM
Kaiene
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Kaiene is not online. Last active: 05-25-2013, 7:52 AMPlatinum

It sounds like you didn't consolidate.  I don't remember what the rules are on that; I did mine 6 years ago.

I agree with pp and talk to a mortgage broker and see what they suggest you do to help improve your chances.  We were approved and both of us had car payments and I had 2 SLs at the time; only 1 now. 


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12-12-2012 at 9:21 AM
ashleyy00
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ashleyy00 is not online. Last active: 12-20-2012, 11:16 AMNewbie
My FI works in approving mortage loans. Unfortunately, all they look at is your credit score no other factors (such as ability to repay).  They used to be able to factor other things and make decisions based on each loan app, but after the housing market crisis tons of new laws were enacted- the major outcome for home buyers is that you're just a credit score number. However, your score isn't terrible so it may be doable.
 
12-12-2012 at 8:39 PM
wife07mom0...
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wife07mom09 is online. Last active: 05-25-2013, 10:59 AMSilver

it depneds on debt to income ratio ie how much you make andhow much you can afford

can you afford loan payments and a house?

if so no worries 


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