Is it possible to have a low credit score and still buy a home? We are planning to buy a home in the next year or two. The goal is to pay off all credit cards and everything on the credit report. The only loan we will still have is a car loan 13k. Our scores are low so it will be hard to get up to high 500's or 600's. We will attempt to have 6-7k down. Household income around 70k with one payment of $400 for car loan. Is this journey possible to get a home?
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You may find that most lenders are looking for FICO score minimums in the mid-600s. Your best bet may be to contact the FHA at their toll-free number (1-800 CALL FHA) and request a referral to a local, HUD-approved housing counselor who can help with advice on pre-purchase planning issues like these to see what can be done to make you as ready as possible for a home loan application.
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