Mortgages For People With Bad Credit
Mortgages for people with bad credit definitely exist, but no one knows that spectrum of the mortgage industry better than Tim Barr! Getting approved for a home loan with bad credit may feel like no easy task. But there is still great news. Even if you have bad credit, getting a mortgage doesn’t always have to be out of reach. There are several poor credit mortgages for people with bad credit. With the right lender, you may be able to find a mortgage that meets your financial needs and doesn’t bust your budget. Homestead Mortgage has great mortgages for people with bad credit.
What is a Credit Score?
Your credit score is a three-digit number generated by a mathematical algorithm using information in your credit report, also known as a FICO credit score. A person has three FICO scores provided by three major credit bureaus, Equifax, Experian and TransUnion. FICO scores range from 300 to 850, where a higher number indicates lower risk.
Bad Credit Home Loans
It’s no surprise that lenders often prefer loaning money to people with good credit, but borrowers with bad credit shouldn’t throw in the towel yet. Though It may be harder to get approved for one of the poor credit mortgages available, it’s not impossible.
FHA Home Loan
An FHA loan is insured by the Federal Housing Administration (FHA), and created to increase homeownership in America for people with less than stellar credit. Borrowers with credit scores 580 and above can get a home loan with a down payment as low as 3.5%. With a credit score between 500 and 579, the borrowers will need a down payment of at least 10%.
USDA Home Loan
A USDA loan is backed by the United States Department of Agriculture (USDA), and designed to provide a mortgage alternative for eligible home buyers in rural and suburban areas who had limited financing options to realize their dream of home ownership. Most lenders underwriting USDA loans require a minimum credit score between 620 and 640 with no significant delinquencies, foreclosures or bankruptcies in the past several years
VA Home Loan
The VA Loan is a mortgage that’s issued by approved lenders and guaranteed by the U.S. Department of Veterans Affairs (VA), that’s guaranteed millions of veterans, active duty military members and their families to purchase homes without needing excellent credit. Most lenders require a 620 or higher credit score, while some may be able to work with a 580 credit score in certain situations.
Fear of loan denial has led many potential home buyers with bad credit scores to simply not bother applying for a home loan. Your credit score is a piece in the qualification puzzle, but it’s not the whole puzzle. it is still possible to get a home loan with a low credit score from some lenders.
In case you are unable to qualify poor credit mortgage originator, Tim Barr, can also help put you on the right path to improving your credit score. To learn more about your bad credit home loan options, contact the Homestead Mortgage home loan expert Tim Barr today!