How to Buy a House With Bad Credit & No Money Down
Owning a home is an American dream. But some people don't have the opportunity to achieve this goal. Bad credit, no credit history or little cash stops many people from qualifying for a home loan. Yet there are ways to obtain a no-money-down mortgage with less-than-perfect credit. The key is finding the right lenders and choosing the right loan program. This requires research and patience.
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Instructions
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Raise your credit score above 600. While some lenders offer no-money-down mortgages to people with bad credit, borrowers must meet the minimum requirements. Lenders rarely offer loans to people with credit scores below 600. Thus, it's essential to order a copy of your credit report and credit score, and if necessary, take steps to raise a low score. This includes reducing your debts and paying your credit cards on time.
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Contact a mortgage broker. Mortgage lenders prefer prime applicants, and some lenders don't offer no-money-down mortgage loans to people with bad credit. Mortgage brokers have relationships with several banks and mortgage companies, and they'll help you find a lender. Because brokers work on commission, inquire about fees before choosing a company.
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Consider a lease-to-own property. If a mortgage broker cannot find a lender, a rent-to-own agreement may be a solution. Find a motivated home seller and propose a lease-to-own arrangement. You agree to rent the property for a specified term, during which a percentage of your rent payments go toward your down payment. Once you've had time to improve your credit, you'll apply for a mortgage loan and take ownership of the property.
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Find a co-signer for the mortgage loan. Ask a close relative to become a co-debtor on your home loan. If they have an excellent credit history and sufficient income, this can improve your odds of obtaining 100 percent financing with bad credit.
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Comments
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first time buyer hopeing for something in a good area in orlando! need all the ADVICE!
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give me a call.. i don't have your new #..
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Don't worry Leigh I'm not going anywhere!
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I see how it is. Why do I feel that n abt six months I will be sitting in morning saying "another one bites the dust".
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I am trying to get a mortgage! I am open to any advice, help, counsel and/or wisdom from anyone who has gone through this process and achieved a positive outcome...
