If you have bad credit then there’s a good chance that getting a mortgage has been a challenge for you. Bad credit will hurt you with any loan, even small loans, but can be crippling when trying to get a large home loan. It’s normal to face rejection and frustration at every turn, or at least it used to be that way. These days, bad credit does not mean you can’t get approved for a mortgage.
You can get a mortgage even if you have bad credit and it’s not that difficult either. With mortgage companies now specializing in bad credit mortgages, getting the home loan you need is easier than ever. If fact, even banks and traditional mortgage lenders are now getting into the bad credit mortgage arena and offering terms that are fair. They know too that bad credit can strike almost anyone these days.
Mortgage companies that offer loans for bad credit are often referred to as sub prime lenders. They often work exclusively with borrowers that have substandard credit scores, usually defined as any score below 620. These mortgage companies will still use your credit score to determine the rates and loans you are eligible for, but they won’t summarily decline your loan simply because your score is below 620. The bad credit mortgage companies do draw the line though and typically if your score is below 500 there is little they can do to help.
Because there are now companies willing to offer mortgages to people with bad credit many people are now homeowners that wouldn’t have qualified for a mortgage just 10 years ago. Just remember though that not all bad credit mortgage lenders have your best interests at heart. Some of these companies are looking just to line their pockets and care should be taken when choosing a bad credit mortgage company.
Just do yourself a favor and take the time to do some research before you start working with a mortgage lender. Get quotes from several different lenders and go with the ones that offer the best rates and terms. Read the fine print too and make sure you understand the terms of the loan so you don’t end up surprised later. Mortgages for people with bad credit are definitely available, but it’s important to keep yourself safe as well.