When my nephew was entering his Junior year in College I told my brother he HAD to add the kid to one of his credit cards. “WHY? He can’t pay the bill, he doesn’t have a job.” Well, the reason I wanted him to be added to at least one credit card as an Authorized User is because this is a bright kid – and I knew shortly after graduating, he was going to want to buy a house. In order to buy a house – guess what? You need a credit history. We talk to college graduates all the time who ask: “I am Recent College Grad, Have a Job, Can I Get A House??” When we talk to first time home buyers in North Carolina who are recent graduates, we generally need to ask these questions…
Do You Have A Credit Score?
Well, if your parents were smart, and added (or opened) a credit card or two, adding you as an Authorize User, while you were in college the answer is maybe. Ideally, you need 3 lines of credit, with some history on them to qualify to buy a house. The credit cards you are added to should:
- Have a balance that is no more than 30% of the high credit, or limit on the credit card
- Must have been opened once you turned 18. A card that your dad opened when you were 3 isn’t going to add ANYTHING to your credit file.
- Must be used occasionally. If it carries a $20 balance from month to month – yes that means you need to have some interest that you are carrying on the card – you will get higher credit scores, faster.
- Should be from a Direct Bank – Best Buy and Victoria Secret Accounts are okay, but ideally, you should get the cards from a bank, like Wells Fargo.
- If you have student loans, which is considered Installment Debt – you desperately need to do this by your Junior Year in College. If you can’t get added to anyone’s account then take $300 and get a Secured Credit Card (again – the ideal number of cards here is 3).
You may have heard that we can use “non-traditional” credit to help a first time Home Buyer get into a house in North Carolina. We CAN do that for Veteran’s who have a credit score, but do not have any current open lines of credit. However, for just about anybody else – that no longer works.
North Carolina Home Loan mortgage interest rates have drifted a little lower – after the big jump in June. The Federal Reserve has said repeatedly that they want to keep Home Loan Rates really low, so now really is the time to buy. If you are tired of trying to find a parking spot in an Apartment complex, and you’re ready to buy – Credit is only one of the factors we need to look at.
Can We Show Job Stability?
If you just started your job, don’t worry – we probably won’t need two years of job history to get you qualified to buy a house. If you get a job within your field of study that is not based upon Commissions or substantial bonuses – we can probably use the income to qualify you for a North Carolina Home Loan. We will need to see your letter of offer, your first paystub and get a copy of your college degree. If there is a probationary period that comes with your new job – we will not be able to close on your home until after that probationary date.
If your college degree is in Mechanical Engineering – and you get a job working for Sears (read job does not have anything to do with your college degree), it’s a little bit harder to make this work, but it’s not impossible.
If you are working on a stipend, or grant – we must prove that your income is likely to continue for at least 36 more months after closing. Depending on the Grant or research project – this can be difficult to do. We can, however, add a non-occupying co-borrower using a FHA Program. With this program, you would still need credit scores, but we can add a family member to help with income qualifying.
Do You Have Any Savings?
This is really the last question because if you have $1000 to $500, we can probably help you get into a house. Having savings left over after closing is helpful, and we work very hard to help First Time Home Buyers get into a house with as little out of pocket expense as possible. Ways that we can help you get into a home with very little savings coming out of pocket include:
- No Closing Cost Mortgage – with this you pay a little higher interest rate in order to have us, in essence finance in most of your closing costs.
- Seller Paid Closing Costs – we can help you negotiate an offer to purchase with the Seller paying most of the closing cost. We can also do this in conjunction with a No Closing Costs Mortgage so that e are giving you a credit to cover your taxes and homeowners insurance
- NCHFA 3% Grant Program that we offer for First Time Home Buyers. Not all Banks in NC offer this program, but it’s a great way to save money and get into a house.
- Getting a mortgage with a North Carolina Home Loan that does not require a down payment, or at the least a minimum down payment. The options include:
- USDA Home Loans which require no down payment. There are restrictions about where the property must be located, and there are household income restrictions that vary per county in North Carolina
- FHA Home Loans only require a 3.5% down payment and that money can come 100% from gift funds or the NCHFA First Time Home Buyer Grant Program.
- VA Home Loans are for qualifying Veterans and they do not have any down payment requirements, as well.
As a recent College Grad, first off we want to say, CONGRATS! We have the programs and the knowledge to help you save for a home in North Carolina! If you have more questions along the lines of “I am Recent College Grad, Have a Job, Can I Get A House??” Call Steve and Eleanor Thorne, 919-649-5058 Or leave us a comment below – we try to answer all of them We offer the Best Mortgage Rates in North Carolina, 919-649-5058. Connect with us on Google Plus and Facebook