Resources for people with Bad Credit & information on Credit Reports, Debt Consolidation, Auto Loans, Mortgages, & more.

Bad Credit Mortage Resource Guide

Bad Credit Mortgage

Lenders not only look at your credit score but they also look at the factors on your credit report that make your credit bad. These factors are what you are borrowing, charging, and your repayment activities. This is called your credit rating. For instance, if your credit score is 650 or higher, you may not have enough credit history or maybe you have made some late payments in the past, so this would be a case where a mortgage lender would not approve you. So, it is very important to know your credit history and credit score before applying for a mortgage.

There are so many bad credit mortgage lenders to choose from. They are also known as sub-prime mortgage lenders. Don't apply with every one of the bad credit mortgage lenders. Choose up to 3 bad credit mortgage lenders you feel comfortable with. If they charge upfront fees, do not choose them.

A bad credit mortgage lender will likely look at three main factors:

1. They will look at your credit history. They look at your credit score, how you pay your bills, and if you have any liens, collections, or judgements against you.

2. They will look for proof that you have the ability to repay your mortgage. They look at your job history to decide if they think you will continue to generate enough income to repay the debt. A self employed borrower often has trouble proving income. There are certain programs specifically geared for these individuals such as no income verification mortgages or bank statement mortgages.

3. They will look at your down payment. A mortgage lender will want more of a down payment if you have bad credit. You are less of a risk to them if you have put more cash into the property. They think you will be more likely to make the mortgage payments if you have your cash invested in the property.

There are numerous lenders available for those looking for a bad credit mortgage. A mistake commonly made by homebuyers is how they think they know how their credit report is viewed by lenders. They sometimes think it is worse than it really is, and may well have been able to get a better mortgage than what they think. Others don't even consider their credit report and are not aware of problems, but then need to scramble at the last minute to get the problems handled. To avoid this, simply get a free credit report and look it over for problems or errors. You may need to reestablish your credit before applying for a mortgage. Find out first before you spend time applying to lenders who do not work with credit problems since it will accomplish nothing. If you find you need to obtain a bad credit mortgage, just concentrate on those lenders who specialize in working with bad credit mortgages.