Can People with Bad Credit Avail a Home Loan?

Do you have a bad credit record and are having a problem getting a home loan in the past? If yes, then do not lose hope as there are so many loans readily available for people with a not-so-stellar credit rating. You will have a bad credit record if:

• You experienced bankruptcy
• You are late in your credit card payment
• Default/Delinquent on past loan

Types of loan for people with bad credit

• Secured loan – it is called secured loan because you are going to present a valuable property as collateral such as a house and lot, car, and the likes. If you have poor credit, and you want to borrow money, then a secured loan is the best way to go.
• Unsecured loan – as the name suggests, it is not secured by any property. This type of loan is quite hard to come by, and if you found one, the interest rate is high. If you don’t have any property to secure your loan, then the best thing you can do is perform a comprehensive research for you to find a lender that offers unsecured loan at a favorable rate.

You can still avail a home loan even if you have a bad credit record. There are now mortgage companies willing to give you the loan you want as long as you strictly adhere to their eligibility requirements. If you have bad credit, applying for a new loan is a perfect opportunity for you to repair your credit record. You just need to make sure that you will not be delinquent with the payment for your new loan to have a positive impact on your credit score. According to research, borrowers who are up-to-date with their monthly loan payment gets an additional 30 to 50 points every year. In a few years, you will be able to get an almost perfect credit score.

Just because you have a poor credit record does not necessarily mean that it is the end of the road for you. There is still hope. Do your research well and find a mortgage lender that can cater to your needs. The Freedom Mortgage Corporation is one of the best lending institutions today. It is no neophyte in the business. In fact, it has been in the lending industry for more than 25 years now, and they were able to help a lot of people from all walks of life. Contact the company and get to know more about their available home loans by visiting this site https://careers-freedommortgage.icims.com/.

 

 

 

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How to get approved when applying for mortgage loans with bad credit?

People with bad credit record feel that there is a slim possibility for their loan to get approved. Well, your credit rating does matter when applying for mortgage loans. Ideally, you should have a stellar credit score for your loan to push through. If you got a poor credit record, then don’t lose hope for you can still apply for a mortgage loan and have it approved by the lender. You just have to prove to the lender that you are capable of repaying the loan on time.

Debt to income ratio

Lenders do not only check the credit report but as well as your debt to income ratio. Many lenders require that not more than 40% of your current income should be assigned for debt repayment. If you are earning $20,000 a month, $8,000 should be used to pay the existing debt. Even those people with excellent credit rating can be turned down by the lender if they do not have a good debt to income ratio.

Prove to the lender that you are now capable of repaying the loan

There are many reasons why you get a bad credit rating. It could be that you are delinquent with your credit card payment, not being able to pay the loan on time, and the likes. It is true that it is easy to ruin a credit record but extremely difficult to repair, but the thing is, it can be repaired. It’s just that there are circumstances that lead you to be delayed with your payment such as unemployment, hospitalization, and so much more. Prove to the lender that you are now back on your feet and are willing to do everything to prove to them that you are now good in repaying the loan.

Apply for a small loan

If you have a poor credit score, it will be easier for you to get approved if you request a small loan. Do not immediately jump to big loans as you will surely have a hard time be approved. Apply for a small loan, pay on time and improve your credit before taking out large ones.

Applying for a mortgage loan with bad credit is harder than those with excellent credit record. The good thing is that it is still possible, and you just need to search around and look for deals. The Freedom Mortgage Corporation is one of the highly trusted lending companies today. It offers different types of mortgage loans for people from all walks of life. Click on this link https://www.linkedin.com/company/freedom-mortgage to know more about the company and the services it offers.

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