Poor Credit Home Loan

Posted by admin on August 29th, 2009 at 12:00am

Question:
How do you obtain a poor credit home loan?
I do not have very great credit right now and was wondering how difficult would it be to obtain a poor credit home loan right now? Do they issue home loans for under 70,000 dollars?

Answers:
If your credit is not that decent, an FHA loan would most likely be your best bet. You will have to put 3.5% as a down payment, if the seller concedes to pay your closing costs. If you happen to own any open collection accounts, those would need to be paid off as a requirement of your loan approval.
If you purchase a HUD repo, it will only be 100 dollars down, but you would likely pay up to three percent in closing costs.
The more ideal option would be to repair your credit. The real estate market is not going to suddenly recover, so you could probably wait six months to purchase a house. Homes usually cost less towards the end of the year anyway, since the buying market slows down.
The National Consumer Rights Alliance performs no-cost credit repair to any of its members, and you get a good number of other advantages with membership. If you are sincere about repairing your credit, give them a ring. They can also maybe refer you to a mortgage issuer who can finance your home when you are prepared to buy.

In this day’s atmosphere, it will be difficult, but not impossible to get a poor credit home loan. Your income to debt ratio would be more critical than your actual score, and the higher your down payment, the luckier your chances. It would also be based on what the appraised value of the home is. You are never going to know unless you try.

I would deeply recommend you fixing up your credit first. Decent financial gurus are Suze Orman, David Bach, and Jean Chatzky. Their work can be bought on Amazon.com. Good luck to you.

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