How to get a mortgage even if you have a bad credit rating
If you are having trouble getting a mortgage, you need to
remember one thing:- Persistence. If you give up trying, you
will NEVER get that mortgage. It’s also worth noting that there
are a great many variables that determine whether a lender will
approve you for a loan. SOme of these variables are outside your
control (criminal record, CCJs, Bankruptcy, Previous
foreclosures etc) while others can be influenced by you in order
to improve your chances of a mortgage approval.
Some lenders specialize in ‘sub prime’ loans -loans to customers
with less than perfect credit histories. These are the lenders
you should be targeting. Sometimes, they have a set time limit
from a foreclosure or bankruptcy before they will approve you
for a mortgage (often between 24 and 36 months). Sometimes they
don’t, and you can be approved for a loan the same day you are
discharged from bankruptcy. Obviously, they charge higher
interest rates to reflect the greater risk that you now
represent, but hey! No loan, or a slightly more expensive loan?!
Ultimately, we here at www.mortgagedown.com
think that what determines whether or not your mortgage is
approved is your ‘credit score’. Anything over ’600′ and most
lenders will happily approve your loan, no matter what little
‘stains’ there are on your record. The process of creating your
credit score is mostly automatic these days, and this is what
you need to understand in order to bask in the glory of a 600
plus credit score when applying for a mortgage.
So how do you make sure your credit score is above the 600 level
so you can get 100% financing? First off, stay RIGHT away from
so called ‘credit repair’ agencies. They will often do more harm
than good, and you will be handing over your cash for absolutely
nothing or worse. What you can do is try and ensure your record
is as ‘clean’ as possible. First step, obviously, is to check
your credit rating for any inaccuracies. You have a statutory
right to see what financial information any company holds =bout
you, and this includes your credit rating. Ensure paid off
charges are shown accurately as paid off – this is the biggest
reason for bad credit scores when the record is in fact pretty
clean. Every past charge that your have since paid off should be
checked, and once you have done this, you can demand a letter of
confirmation that the account is now fully paid up. You can, in
fact, cause severe problems for any credit agency not reflecting
the true state of your credit affairs.
If your target loan company needs proof the charges have been
paid off, you can ask for the same from your other lenders – for
a small fee (sub $100 usually) they will provide notarized
letters confirming your account is now paid off and closed. This
will reflect well in your credit score within 2 or 3 working
days. Next, credit specialits at www.mortgagedown.com
advise that you pay off as much as you can on any credit cards
or other loans outstanding. Obviously, the less outstanding debt
you have, the better your credit score will be in terms of going
for a new mortgage. In fact, if you ‘max out’ credit lines or
cards, this will reflect VERY badly on your credit score.
Finally, be careful not to approach too many lenders in too
short a time period. Repeated attempts to get credit can
themselves lower credit scores. Remember that even if you score
less than 600, it is still possible to get that mortgage, but
you may need to ‘shop around’ a little, and you will almost
certainly pay an extra fee or higher interest as a penalty.
Beware of companies claiming that ‘if they can’t get you the
loan, you can’t get one period’ because ultimately, whether or
not you get a loan is down to you!
