First Time Home Buyers: Getting Approved for a Bad Credit Mortgage
Although mortgage experts recommend home buyers saving money for down payment and closing, this is no longer a requirement. In fact, having good or acceptable credit is no longer a requirement for obtaining a mortgage loan.
True, a good credit rating will have positive effects. For example, good credit may help buyers qualify for a lower rate. This could amount to buying a more expensive home. Nonetheless, mortgage lenders are realistic, and they realize that a large percentage of buyers entering the housing market have fair to bad credit ratings. Thus, they have created home loans that target these individuals.
Types of Bad Credit First Time Home Buyer Loans
Buyers have varying circumstances. Hence, there are loans geared to meet specific needs. If bad credit is an issue, working with a mortgage broker may produce good result. Why? For starters, mortgage brokers are familiar with many loan programs and have connections with numerous lenders. For this matter, a broker is more apt to offer sound advice on the most suitable loan programs. Typical bad credit mortgages include:
1. No Money Down Home Loans. Even with bad credit, mortgage lenders and companies are prepared to offer no money down or 100 percent financing loans to first time home buyers. In some instances, a buyer may qualify for 103 percent financing. The additional monies are ideal for paying closing costs and other related fees. To qualify for either loan program, a borrower's credit score cannot drop below 580 - 600.
2. No Credit Score Loan. If you have money for a down payment and closing, consider applying for a no FICO score home loan. These loans are perfect for self-employed and commission-based employers. The only downside to this option is that lenders will only finance 80 percent of the home price. Thus, buyers must be ready to pay the additional 20 percent out-of-pocket. Furthermore, the interest rate on no FICO score home loans is slightly higher.
Reasons to Get a Bad Credit Mortgage
• High Debt to Income Ratio
• Low Credit Score
• Unverifiable Income
• No Credit History
• Previous Bankruptcy, Foreclosure, or Repossession
• Collection Accounts, Past Due Accounts, and Judgments
Tips on Applying for Bad Credit Mortgage
• Attempt to Improve Credit History
• Reduce Debts
• Save Money for a Down Payment
• Avoid Opening New Lines of Credit
• Request Multiple Mortgage Quotes
Published by V.C. Higuera
Freelance personal finance and health writer from Chesapeake, VA View profile
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- Companies that Offer Bad Credit Home Loans
- Zero Down Home Loans Frequently Asked Questions
- Mortgage Shopping Tips for the First-Time Home Buyer
- Wells Fargo Bank Getting Out of the Sub-Prime Home Loans Market
- How Do Bad Credit Loans Work?
- Can I Refinance My Mortgage with Bad Credit?
- Bad Credit Debt Consolidation Loans: Do They Exist?
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- Lenders that offer bad credit mortgages are called sub prime lenders.
39 Comments
Post a CommentFirst time home buyer. My score is the high 500's . I have a house that I want to purchase right now. But, I have been told that there is no way to make this happen unless my score is 600-620...If you have a way please contact me! Good credit history. Always make payments on time and I have a car at 3.9% interest.
smarie1011@gmail.com
My post came out with no spaces, can someone please email me with any info on getting a bad credit home loan with a good amount of money for a down payment. Bess2678@aol.com, thank you
Ihavealowcreditscoreandwaswoderinghowtogetahomeloan.Iamabletogetagoodamountofmoneyforadownpaymentthroughwork.Pleaseemailmeatbess2678@aol.com
Dear Sir/Madam
We Offer Private, Xmas,Commercial and Personal Loans with very Minimal annual Interest Rates as Low as 3% within a 1year to 50 years repayment duration period to any part of the world. We give out loans within the range of $5,000 to $100,000,000 USD. Our loans are well insured for maximum security is our priority.Interested Persons should contact me via
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Lender's Email: mavinmacain@ymail.com
BORROWERS INFORMATION
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Best Regards,
Mavin MaCain
Mother of 2 seeking to purchase 1st home. Credit score high 500's. Please email me with any info on getting approved: carriepowers@cfl.rr.com
First Time Buyer Mortgages
Im in of help with trying to get a home owner loan with a credit score in the 500`s. If anyone could help me with this my email is chuckychuck@comcast.net thank you
My Score is in the low 500. My husband and I both work and we have 7 boys. I get child support for 4 of my boys and SSi for one of my boys for a disabilty. We want to buy our first home and are having trouble getting finacing due to both of our exspouses. We have to find something soon. plz email me back at wolfpack_dockery@yahoo.com
my score is in the 500's and i am wondering if i can get financed for a forclosed home priced around $42000 my email is timbartels88@yahoo.com
Have credit score of 579 and a first time home buyer. Please email lenders or programs that may be of service to me at realbrownsugar2000@yahoo.com