3 Tips To Help You Get A Home Loan If You Have Bad Credit
Your credit score can affect many things in life, including your ability to get a home loan; however, you might not realize that there are many lenders that are willing to offer home loans to people with bad credit. While you may get a lower interest rate if you wait to apply for a home loan until your credit score is higher, you can still get a loan in many cases with a low credit score. Here are three helpful tips that can help you get a home loan if you have bad credit.
Find A Lender That Will Hear Your Hardship
While a credit score can reveal a lot about a person, it never tells the whole story. There may be a good reason your credit score is low, and trying to increase a score often takes many years. It can take waiting for negative reports to fall off a report, and this can take up to 10 years in some cases.
If you have a good reason for having bad credit, find a lender that will take this into consideration. For example, if you lost your spouse to cancer and could not work for six months because of the grief you were going through, you might be able to prove to the lender that this event caused the drop in your score.
Choose A Lender That Will Take Recent Events Into Account
Not only is important to be able to talk to the lender about the hardship you went through, but it is also important to find a lender that will look at the recent events in your life and credit. For example, if you have been working hard on your credit for the last two years and have nothing but good reports during this time, a lender might take this into consideration.
Two years of positive reporting might not increase your score high enough for it to be considered good or excellent, but it does show your character and your current financial habits. This could be a huge positive factor as you seek a home loan.
Make Sure You Have A Down Payment
The other important factor is having a down payment. If you have a large amount of money to put down on a home, a lender might be more apt to give you a loan. When people invest a lot of money into their down payments, they usually take their loans more seriously.
If you are nervous about applying for a home loan, don't be. Find a lender that is willing to work with you, and you might find that this lender offers you an approval for a home loan. You can learn more by contacting a lender such as First Mortgage Company, Inc.