Home mortgage loans for people with poor credit are available at
reasonable rates if you find the right lender. With some time sent online
researching for low credit score lenders, you can base your financing
decision on loan estimate numbers. Even with bad credit, you can find
flexible terms, so you can find the right home loan for your budget.
The Role Of Low Credit Score Lenders
Low credit score lenders, also called subprime lenders, offer financing
to those with scores of less than 650 at slightly higher than
conventional loan rates. On average rates are 1% to 3% higher than "A" rated
loans, but expect to pay more if you have just discharged a bankruptcy or
Subprime loans are not restricted like conventional loans, so you have
many more options with your terms. You can secure 100% financing,
interest only loans, or a traditional fixed rate 30 year mortgage.
Unfortunately, there are companies that would take advantage of your
financing situation by charging high rates and fees. You can protect
yourself from these dishonest companies by comparing loan offers from
several different companies.
Getting A Good Loan Estimate
The best way to find a lender is to base your decision on their loan
estimates. Online lenders can get you mortgage quotes in just minutes,
without having access to your credit report. Not only will you get
information on rates, but also on closing costs and miscellaneous fees.
To get the most accurate numbers, request quotes on the loan amount and
down payment you ideally want. Just remember that if you decide on
different loan terms, you will need to ask for new loan quotes.
Timing Your Mortgage Financing
To give yourself enough time to find the best subprime lender, start
searching for financing before you look for a house. By lining up your
mortgage ahead of time, you'll have a better idea of your borrowing
potential. You will also be able to close the deal sooner on your new home.
Most online lenders can process your loan application in a few days,
with funds available in two weeks. Your escrow company will handle the
final disbursement of funds.
Try using one of ABC Loan Guide's Recommended Poor Credit Mortgage Lenders .