Can I Get a Mortgage With a Bad Credit Rating? [mortgageinsuranceguide.blogspot.com]
The secret mortgage servicers don't want you to know is they can make MORE money off of homeowners when they keep your loan in default. A former employee of loan servicer EMC tells the inside story why so many people can't get their loan out of default.
mortgageinsuranceguide.blogspot.com Mortgage Servicers' Secret
Getting a mortgage when you have a bad credit rating can be very difficult. However it is not impossible, it just requires careful research and some patience. There are lenders out there that will take on high-risk debtors, it's just a case of finding the right one, who is willing to take you on. You will find that the application process for a bad credit mortgage is different to that of a regular mortgage as the lenders want to asses just how much of a risk you could potentially be. They will want to carry out very thorough background checks and go into your financial commitments in detail. They will also want to see a stable employment history and proof of your current income, along with some substantial savings.
The amount of money you have saved is an important aspect of your application, as the more you have saved, the more you will be able to put down as a deposit.
Most high-risk lenders require you to have a large deposit before they will consider lending to you. The main reason for this is that it will mean you are making a substantial investment in the property and therefore will have a vested interest in keeping up with your repayments, as defaulting on your mortgage means you are not only risking losing your home, but also the money you have invested in it. In a lenders eyes this makes you much less likely to default, therefore reduces the risk they are exposing themselves to by lending to you.Your payment history will also be taken into account, even if you have a large deposit and stable employment, if your payment history is bad then this is not going to go in your favour. If your credit report is showing that you frequently miss payments or are late with payments and this has been consistent up until a recent date, then this will make a potential lender very uneasy.
If there are a few missed payments or late payments then this may well be overlooked, as you are applying for a bad credit mortgage, but extensive defaulting on credit agreements is not going to help you obtain a mortgage. If this is the case then you need to take some time to build up a good payment history before even thinking about applying for a mortgage. It is possible to build up a good payment history in the space of six months, you just need to be disciplined, and if you want a mortgage then you should have the motivation to do this.Even if you are unable to get regular credit due to your poor credit rating, you will be able to get a credit card specifically designed for people such as yourself. This will come with a high interest rate and a low credit limit. The idea behind getting a card such as this is that you can use it to make regular payments and show that you aren't such a high risk. Make a couple of small purchases every month and pay the full amount owing off every month, the interest rates will be high so you don't want to leave anything outstanding that can start to accrue interest. The key to this method is not overspending, only making a couple of purchases that you have the money for, so you know you are able to pay it off at the end of the month. The purpose of getting a credit card like this is to help improve your credit rating and credit worthiness in the eyes of a lender, so you are able to obtain a mortgage, you don't want to get yourself into more debt that will spiral out of con trol rapidly due to the interest rates being charged and late payment penalties being applied to your account.
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