Hi and welcome!
I'm glad you found us!
Mr. Un-Handy and I are in the process of buying our first 'real' home. I say first real home because we were homeowners once before. It was back in 2004. We bit off much more than we could chew, were victims of predatory lending at the time, but were fortunately smart enough to get out quick! We sold that home shortly after we were married in 2005 and have been nervous about the subject ever since.
We decided to set a goal to buy something when I turned the big 3-0. It flew up on me, and before we knew it, we were two kids in and 30 was staring me in the face. This past June we decided we'd go for it. Because, you know, we're adults...or something. We needed a permanent home for our kids, the oldest of which has autism and pretty severe anxiety and OCD.
We took the plunge. We had a lot of work to do.
We started with a credit score that was on the low side of average. Low enough that we wouldn't qualify without some work. It went up 80 points in about 10 months. It was a lot of hard work, but now I'm really happy that we did it.
The first step we took was to call a mortgage broker and see where we stood. They told us our score, what the minimum we needed was, and how far we had to go. Their first suggestion was to open some credit cards. Mr. Un-Handy and I had no credit cards. We had one car that was paid off, a few random things that were in collections, and some student loans. We had no good, revolving credit to establish a history. (If we could go back to our younger 18 year old selves, we'd tear those credit offers into pieces!)
The broker was nice enough to provide us with a copy of our credit report, suggested we pay someone to help us clean up our credit, and didn't really take us seriously.
We found a new broker.
Then we went through our credit reports line by line. I read a lot at Credit Info Center and My Fico and we decided to dispute the negative items first. Some had incorrect dates, some had incorrect amounts. We disputed everything. More than half were either corrected for the right amounts, right dates, or in some cases, deleted altogether if they couldn't provide any documentation. It left us with about 5 items, that were now correct, and we started paying. Asking for a 'pay for delete' meaning that you will pay it in full if it gets deleted from your credit report, or sending letters to make payment arrangements. What we could pay, we did. We had nothing over $600, no credit card debt, but no savings.
We opened two credit cards and kept the revolving balance at about 30%, being sure to make our payments on time every month. By increasing the amount of good credit and decreasing the bad, our score started to climb! Before we knew it, spring was here and it was time to start looking. We had been able to save a bit of money, and we were ready to go.
Find a realtor that you feel comfortable with. Make sure they are working or you. We met a few. One didn't take us seriously, another tried to get us to pay him, and the one that we went with, we love. He answers my frantic phone calls and emails. He's patient with my kind of crazy. The mortgage broker has been patient with me too. It's not a stress free process, that's for sure. With our pre-approval in hand, we looked at 5 houses. One we loved, but it was at the high end of our budget. Our realtor told us to wait it out a bit, and as soon as he said that, a home was listed that was exactly what we were looking for. It was priced low, but it had nearly every one of our needs and most of our wants. We put an offer in the day after it was listed, it was accepted, and the contract was completed a few days later.
Currently, we're hurrying up to wait. The application is filled out and being sent out tomorrow. Inspection is scheduled for next week, and before we know it we'll be homeowners. I alternate between being crazy excited and feeling like I'm going to puke at any moment.
From what I understand, that's when the actual fun begins.
So please, follow us. The two, most un-handy people that typically work half-assed, and at 3 AM just because, as we do minor renovations to make this home exactly what we wanted when we started dreaming this up 5 years ago.
If you have any specific questions as we go along, please feel free to ask. I'll be happy to answer what I can.
