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Old 02-08-2010, 01:22 PM
 
7 posts, read 25,412 times
Reputation: 10

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I apologize for making this post with so many dumb questions. My wife and I are in the process of relocating to a few areas (Wisconsin is on that list). We have never owned a home. We have been renters and in our relocation we would like to look into purachsing a home.

I would like to know if there is anyone with good knowledge of the mortgage process who could answer the following questions:

1) Can we get approved for a mortgage with bad credit? (low 600s credit scores)
2) How do you go about the process? I heard about "pre-qualifying". I don't know what that is.
3) Can I just contact a mortgage guy and see how much we qualify for? And how much would that cost?

The reasons for my questions are that we want to know what kind of home we can afford before deciding on an area to move. Plus, I just do not have any knowledge on this at all. I feel guilty for not being financially knowldegable and I want to fix that for my family's sake.

Any answers to help me are greatly appreciated. Thank you in advance for any help anyone can provide. God Bless.
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Old 02-08-2010, 01:34 PM
 
Location: East Side Milwaukee
711 posts, read 1,690,134 times
Reputation: 454
How much house you can afford really depends on a lot of factors in your life. Generally, lenders look at how much money you make and what your expenses are because they want to make sure that you can comfortably repay them.

This calculator isn't perfect, but will give you a general idea of what you can afford. If you don't have great credit, it may be difficult to find a good rate, but you should be able to find a lender.

Affordable Home Calculator from CNNMoney

Also, you'll want to know the difference between pre-qualified and pre-approved.

Pre-qualified means you go to a bank/lender, give them your personal info, and they tell you about how much they can lend to you, but it's no guarantee.

Pre-approved means you complete an actual application and they run credit checks to give you a specific amount that they'll lend to you. You're not 100% guaranteed a loan, but it's a very sure thing. This also looks much better when submitting an offer than someone who is only pre-qualified.

Good luck on your home search and hopefully welcome to WI
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