You’re the first to admit that your credit is not the best. A few mistakes coupled with some unexpected financial setbacks led to where you are today. Does that mean you can’t financing the purchase of a home? The answer is not. There are lenders who offer bad credit mortgage that will help you become a homeowner. If you’re wondering how well this approach could work for you, consider these facets of bad credit mortgages and what they can do right this minute as well as over time.
Your Income Often Matters More Than Your Credit Score
You already know that many banks and other traditional lenders check credit scores before they look at anything else. If your score is under a certain amount, your application is rejected without any further consideration. That’s not the way lenders who offer bad credit mortgages work.
Some will take a look at your credit reports, but the amount of consideration they give them is typically less than traditional lenders. Rather than rejecting your application, these lenders are likely to move on and evaluate other aspects of your current financial situation. That’s good news when the reasons for your currently low scores are several years in the past.
Other lenders don’t even bother to order copies of your credit reports. They base their decisions solely on other criteria. If you’re doing well in other aspects of your financial life other than those low scores, lenders of this type may be the ideal fit.
Recent Comments on Your Reports Carry More Weight
Among the bad credit lenders who do order copies of your reports, expect them to look more at the most recent comments submitted by creditors. If it’s been a couple of years since you made a late payment and if all the most recently submitted comments are good, the lender is likely to remain interested. If the reports also indicate that you don’t have a lot of outstanding debt right now, that’s all the better. What is happening right now will matter more than what took place a few years ago.
How Well You Do With Your Current Debt Also Helps
If you have low balances on any credit card that you have, that’s great. The same is true if you’re up to date on any loan that is currently open. The fact that you’re not creating more debt and the amount you owe is consistently decreasing every month means a great deal. It indicates that whatever happened in the past, you’re managing your resources wisely today. You can bet a bad credit lender will be interested in doing business with you.
A Bad Credit Mortgage Can Help Boost Your Credit Scores
Let’s say you’re approved and the mortgage is now in place. Did you know that many bad credit lenders report activity to the major credit bureaus? Since that’s the case with yours, make sure you remit each installment payment on time. The positive comments will further offset any old negative ones and boost your credit scores. By the time the mortgage is has been in place for a couple of years, you should have much higher scores.
Would you like to own a home in the coming year? Now is the time to contact the team of Mortgage Central Nationwide brokers and see what can be done. You may find that obtaining a mortgage is a lot easier than you anticipated.