Patience is a Virtue
However, if you’re like most people, you’ll probably have to wait it out and apply to one of the programs that offer mortgage loans for bankruptcy after the two-year period. At that time, you can normally finance a loan for 100% if you’ve demonstrated that you’ve made all your payments and as a result increased your credit score.

Down Payment Alternatives
If, at the time of the application for a bankruptcy home mortgage you don’t have the money for a down payment, there are programs that can assist you with your down payment. In addition, grants are available that are available that do not require repayment. Searching online can give you a better idea of the specific bad credit mortgage loan programs that are provided in this regard.

Establish a Routine
That said, it’s still important that you make the effort to show a potential lender that you’re a good payer. Therefore, after you’re discharged from your bankruptcy, you’ll need to make some significant changes in the way you spend your money. Establish a savings plan as well as make it a habit to pay each of your debts on time. Do not apply for any further credit or loans. Take care of the obligations already in force. By demonstrating you’ve developed a routine of conscientiously paying your debts and saving your money, you can turn your financial situation around in your favor.

It’s all in the Past
Lenders who provide bankruptcy mortgages want applicants who have a proven history of reliability with respect to their credit. Therefore, start initiating a plan to remove the stigma of bankruptcy once and for all.

Put your Best Financial Foot Forward
When you get to the point of applying for a bankruptcy mortgage loan, you’ll want to view your payment history and credit score as a lender will. Have the payments been made on a regular basis? Have there been any late pays or no-pays? How many times has the applicant applied for credit? How many inquiries have been made in this regard? Inquiries will lower your score so you have to be careful when applying for any credit or loans. Present yourself in a way and with the qualifications that you know a lender who provides bankruptcy mortgage loans can’t dispute. By altering your behavior and learning to discipline yourself, you can easily obtain a bankruptcy home mortgage for you and your family.

photo credit: BLW Photography

Financial Management
It normally takes about two years for a person to regain their financial standing after bankruptcy. Therefore, during that time it’s important for you to make a conscientious effort to make regular payments on the debts you currently hold, establish a savings plan and review and remove any errors on your credit report. This way you can start building your credit and proving yourself to potential lenders that you will be a good future risk to pay back a loan. Therefore, there is no reason to despair over qualifying for a bankruptcy home mortgage. It can be done if you will change your spending and saving habits and persevere. By doing so, you will be able to qualify for a bankruptcy mortgage and have more control of your financial future.

Make your Payments on Time
Therefore, it’s imperative you make timely payments on all your current debt obligations as well as eschew any more credit or loans. Concentrate on managing what you already have in the way of financial obligations. Keep the amount of inquiries on your credit report to a minimum as well as this can further lower your credit score. Your goal is to rebuild your credit and therefore increase your score. Thus, it’s essential you do everything you can in order to meet this goal. Lenders like to see someone regularly meet their expenses and satisfy their debts. Do what needs to be done in order to accomplish this and you’ll be able to obtain a bankruptcy mortgage loan without difficulty.

Review your Credit Reports
When you feel you’re ready to apply to one of the programs that offer bankruptcy mortgages, get a head start in the process by securing your credit report from each of the three credit reporting agencies. Look and compare the three reports to make sure that each is correct. If you find any errors, seek to correct them as soon as possible before becoming involved in the loan process.

How you File Bankruptcy makes a Difference
You’re in a better position to obtain any of the mortgage loans after bankruptcy if you filed Chapter 13 Bankruptcy versus Chapter 7. Chapter 13 Bankruptcy includes the provision that you are still working at paying off your debt or the intention is there. Chapter 7 Bankruptcy absolves you from any further liability with respect to certain obligations; therefore, a potential lender will usually not look favorably on this type of bankruptcy as it shows you did not or could not pay back your creditors.

A Goal for the Future
As stated, before trying to apply for a bankruptcy home mortgage, you should make every effort to build your credit score by making timely payments and establishing a regular savings plan for a period of about two years. In order to overcome the stigma of bankruptcy, you’ll need to concentrate in demonstrating to any potential lender that you can be financially reliable. It’s important to do if you wish to have a future that is secure for your family.
photo credit: box of lettuce

Chapter 13 vs. Chapter 7 Bankruptcy

Much depends on whether you filed Chapter 13 or Chapter 7 Bankruptcy as to how you will proceed in obtaining any future bankruptcy mortgage loans. For example, when you file Chapter 13 Bankruptcy you typically can salvage your home from foreclosure’s wrecking ball. Therefore, you are indeed a candidate for any future bankruptcy home mortgage.

However, if you opt for filing Chapter 7 Bankruptcy proceedings, because you are fully discharged of your debts, in all likelihood, you may not be able to keep any real estate you own as well. In order for this not to happen, a “Reaffirmation Agreement” is usually filed. This way you can work with the mortgagor to pay off your debt on your property.

Given the above information, what do you have to do to obtain a bankruptcy home mortgage?

Re-establish Your Credit Standing
Any of the bankruptcy mortgages offer someone who is a sub-prime borrower the opportunity to make restitution for their past credit mistakes. Therefore, the first thing you must concentrate on is to re-establish your credit so a lender who is considering you for such a bad credit mortgage has the confidence in your ability to pay back the debt. Make it a point then to make regular payments on the debts you currently have so you can build your credit to a level that can justify securing a loan.

Formulate a Budget
To get into the practice of making regular payments, you will have to form a budgetary plan and make every effort to stick to it. Don’t fall back into the pattern that got you into a bad credit situation in the first place. Learn from your past credit mistakes and you can obtain a bankruptcy mortgage that will help you gain a financial record that can’t be erased.

Start Saving
With a bankruptcy history, you will have to realize you won’t be afforded the same privileges you once were from a credit standpoint. Therefore, it’s important to set up a savings plan and learn to discipline yourself financially. By doing so, you can indeed obtain a bankruptcy mortgage loan that will give you the leeway to correct your past credit mistakes and learn to be more prudent in financial matters overall.

The FHA: A Good Resource
Probably the best source to look at with respect to any bankruptcy mortgage loans is the FHA. The FHA has many programs that can assist in helping people with bankruptcy as a part of their financial history.
Review your Credit Report

Learn to save and keep up-to-date on what your credit report says. If there are any inaccuracies, it’s essential you make strides to remove them or correct them right away. By doing so, you will always be on top of your financial situation and therefore in better control of your budget.

Stay Focused
Probably the three most important areas to concentrate on with respect to qualifying for any of the bankruptcy mortgage loans out there are income, your credit score and the down payment. If you start learning to save regularly, paying your debts on a timely basis and making sure that your credit report reflects favorably on you, you can make a new start and see the day when you will overcome any budgetary woes and once again have financial security.
photo credit: n0nick

Step 1: Gather the Documents
You will need to gather quite a bit of information, but once the information is all together it will make the rest of the process much easier. Gather this information for each person who will be listed on the loan paperwork.
A.    Employment Records

1. W2’s
2. Your most recent paystubs for the past 2 months
3. Employment history for your last 3 positions, including dates, addresses and phone numbers and salary information

B.    Tax & Bank Documents

1. Past 2 years tax documents
2. Past years bank statements (some lenders require more)

C.    Credit Card and Loan Documents

1. Recent Mortgage statements
2. Most recent credit card statements listing how much you owe and monthly payment
3. Most recent car loan statement listing how much you owe and monthly payment
4. Any other loan or debt information – what will be needed is total current balance and the monthly payment amount

D.    Asset Information

1. Statements of any stock, investment, IRA, 401k accounts
2. Valuation of any cars, boats or other major assets you own
3. Bank statements of any other investment accounts
4. Property tax documents for the home you are refinancing
5. Title information on the home you are refinancing

E.    Personal Information

1. Residence history for the past 7 years
2. Social security number

Step 2: Fill Out the Application
Using the information you gathered, fill out each line of the application using the relevant information.  If it asks you for the type of mortgage loan and terms, leave that section blank as you do not know yet which loan you will accept. The more complete you can be on your bad credit mortgage refinance loan application, the better the chances of having it approved right away without delay.

1. Property Information Section
   Since this is a refinance, fill in your current property information. You will likely be asked how the title is currently held, how you would like the title to be held on the new loan, and the current value of the property. You can leave current value blank if you do not yet have an appraisal.
2. Borrower Information
   Here you want to list all of your personal information – name, SSN, residence history, etc. Be as complete as possible, missing information can cause delays.
3. Employment Information
   Fill in complete information on current and previous employers. Check with your employer on how they like to handle income and employment verification requests and be sure to list the correct information on how the lender can contact your employer.
4. Income and Expense Information
   Use your paystubs to fill in the information on income.
5. Assets and Liabilities
   Take a look at your credit card and loan statements to fill out the liabilities section. Use the asset information you gathered to fill out the asset section.
6. Signatures
   Depending on the form, you may need to sign the document in multiple locations.

Tips & Tricks

• If you get stuck at any point, ask for help from your bad credit mortgage lender or broker. They are familiar with the forms they use and can help explain exactly what the form is asking for.
• Try to think of all your sources of income. Do you have a small part-time business where you earn an extra $100/month? Don’t forget to list it. Pensions, annuities and other regular sources of income can really help with the income portion of the application.
• If you have a long history in the same field, ask the lender how they would like you to list it. Let’s say you’ve been an electrical engineer for 25 years but recently have switched jobs 3 times in the last 5 years, letting them know your long history can help.
• Personal Letter –I have found that it can help to write a personal letter explaining your situation, why you are applying for the loan and how the loan will help you and your family. If you can provide character references (not family members) who the lender can contact, that can be a help too. This letter can help the lender put a face on your application and become more vested in helping you get your loan approved.
• Keep a copy of your application and use it for future loan applications. Next time all you will need to do is update a few areas and it will make the whole process much faster.

Conclusion

Filling out a mortgage application isn’t hard, it’s just time consuming. The tips and tricks above should help you have success in your application. Remember to talk with your lender if you have any questions. With the information provided above, you should be able to gather the necessary documents quickly and get your application filled out so you can qualify for a great bad credit home mortgage refinance.

photo credit: Casey Serin

Primary Considerations for Approving Mortgage Loans for People with Bad Credit

Mortgage lenders for bad credit are typically referred to as sub-prime lenders. These lenders are non-traditional lenders whose main responsibility is to help you, the sub-prime borrower, obtain a mortgage for bad credit loan. Normally, there are two criteria they use to establish whether you’re a viable candidate for any of the mortgages for bad credit that are available. One criterion used to determine a candidate’s suitability for any of the mortgage loans for people with bad credit is one’s debt-to-income ratio. In other words, your income should exceed your expenses with respect to gaining approval for a bad credit mortgage loan.

The other criterion used is the loan-to-value ratio. The lender uses this calculation to qualify you based on the requested amount of the loan as compared with the property’s value or worth of the collateral you’re trying to purchase.

Other Considerations for Approval

Once the sub-prime lender has determined you meet the above calculations, he looks at your credit score. Before applying for any of the mortgages for people with bad credit, it’s good to obtain a copy of your FICO score for your review. That way, you’ll be better able to work with your lender in order to prove your reliability for repaying this “second chance” higher interest loan. Explain to him, if feasible, reasons for defaults or late payments. Lenders tend to be more understanding if such delinquencies were due, in part, to being laid off or because of a divorce settlement.

Your loan will be considered as well on your net income or income after taxes. Also, if you can apply for the loan offering some kind of down payment, your chances will be improved. Typically, a home should not be purchased that is more than two and one-half times your income per annum. Therefore, trying to apply for a mortgage for more than this amount may prove to be a hardship down the road which is especially important to keep in mind if you’re applying for a bad credit mortgage loan.

Types of Bad Credit Mortgage Loans

The two basic types of mortgage loans for bad credit are a fixed rate type mortgage and the adjustable rate mortgage, normally referred to as an ARM.

The fixed rate mortgage is a long-term secured loan whose interest rate, as the name implies, remains fixed through the life of the loan. On the other hand, an ARM is a secured loan whose interest rate can vary depending on the current market conditions.

Sometimes an ARM is a good mortgage for bad credit loan as the interest for the first year of the loan is substantially lower than other rates prevailing at the time. Thereafter, the rate is typically adjusted and the payment is determined on the amount of interest based on the market index to which it’s tied.

Final Suggestions

Whatever type of bad credit mortgage loan you choose, make sure you secure the lowest “high interest” rate you can. Be assured if you prove your ability to meet your payments on a regular basis that you have the opportunity to refinance at a lower interest rate at a later time.

When you secure your loan, get into the habit of paying bills on time and carrying credit card balances that are approximately within 25% of the limits on the cards. That way you can start on a progressive track to a better credit score and a happier financial future.


photo credit: Ryan Stanton

Overview

A refinance loan is different than an origination loan in a couple of respects. First, there is already a loan in place which is generally a good thing. If you’ve made your payments on time, hopefully your credit has improved some since you first acquired the loan. Second, there may now be equity in the property to draw on when refinancing. With the housing market today however, not all home owners are finding that they have equity. There are a few programs that will loan more than 100% of a home’s value.

Get prepared, know the facts and then start shopping for the right bad credit home refinance armed with the right information that can save you thousands of dollars.

Credit Worthiness

Just like when you first purchased your home or your car, your credit score will be an important factor in the kinds of refinance options you have available. Know your score, know what blemishes are on your credit reports and if possible have a written statement explaining the reason for any late payments or other derogatory information. Depending on your credit score, you may not even need a bad credit mortgage refinance.

Equity

Before you start looking for a particular program, it’s a good idea to know how much your home or car is worth. For homes, get a ballpark appraisal from a local real estate agent. You want to know if your house is worth more or less than what you owe on it. Find your most recent mortgage statement – that will be needed to verify your balance.

For a car, check out values on Kelly Blue Book to see what the current value of your car is and compare it to your car loan statement.

A refinance with bad credit is much easier to accomplish if you have some equity built up.

Types of Bad Credit Refinance Loans

• Bad Credit Mortgage Refinance – There are many refinance programs available for homeowners just as there are many programs available for home origination loans. In a way, you are shopping for a new mortgage altogether when you refinance. Refer to our articles on bad credit mortgages to get a broad background on the types of mortgages available.
• Bad Credit Auto Refinance – Most people refinance their car loans in order to lower the monthly payment. When you do refinance, consider the amount of time you want to be repaying your loan. You can lower your payment by either reducing the interest rate or by lengthening the term of the loan. If you have improved your credit since you originally purchased the vehicle, you may be able to negotiate a lower interest rate but keep your initial term which means you won’t be extending the life of the loan. Generally speaking, refinancing an auto loan is fairly straightforward. If your current lender does not have any available programs, make sure you shop around.

Summary

Refinancing is a major undertaking, particularly for bad credit home loan refinance. It is just like shopping for a new mortgage. Refinancing your auto loan is a bit simpler. With either kind of refinance make sure you know your score, know what you can afford and take the time to comparison shop.

I hope you have enjoyed this series of articles on Bad Credit Loans. If you have I would love to hear from you.

The entire series of articles is listed below for reference.

Bad Credit Loans | Part One: Loans for People with Bad Credit
Bad Credit Loans | Part Two: Mortgage Loans for People with Bad Credit
Bad Credit Loans | Part Three: Car Loans for People with Bad Credit
Bad Credit Loans| Part Four: Personal Loans for People with Bad Credit
Bad Credit Loans| Part Five: Bad Credit Refinance

photo credit: woodleywonderworks

Overview

To find a mortgage loan for people with bad credit, you may need to be a bit more dedicated in your search. There are a large variety of programs out there – and that is part of the problem. There are varying degrees of bad credit. You want to get the best possible deal you can qualify for – not just any bad credit mortgage. You may even discover that you don’t need a bad credit mortgage. You want to go into the process prepared. That way you can ask the right questions, find the right loan product and hopefully get an interest rate you can live with.

Types of Loans

With the recent crackdown on subprime mortgages, it will take a little more digging to find a good loan product. It will be important to research as much as you can on the types of bad credit mortgages.

• ARM Bad Credit Mortgages – Most of the mortgage loans for people with bad credit are adjustable rate mortgages. These can be helpful to get into a loan at a lower payment in the first few years. However you must be careful to know before you sign your paperwork how much the mortgage can adjust. You don’t want your payment to double after the first few years of your loan. Look for 2/28 and 3/27 loans when researching this type of loan.
• Longer term fixed mortgages – There are some programs that offer a fixed rate loan but at a longer term like 40 or 50 years. These loans have the added security of knowing that your payment will not increase. However, because the term is longer you will end up paying well over an extra $100,000 over the life of the loan on an average mortgage amount.
• Low document mortgages – If you do not have a lengthy credit history or if you have other documentation issues, you may be able to find a “stated income” or “low doc” loan. These will typically have higher interest rates but can get you into a house and help you begin earning equity.

Mortgage Lenders for People with Bad Credit

Once you have a fairly good idea of the kind of loan that you think will fit your needs, it’s time to look for a lender or broker to help you find the best terms. Since your lender or broker will be your advocate, make sure you can find someone you feel comfortable working with and someone who will keep in contact with you throughout the process. Rely on referrals from friends and family or your real estate agent. You can also shop for a loan online if you feel very confident in the kind of loan you need and a good estimate of the kind of interest rates you should be getting for your credit score.

Regardless of how you find your broker, make sure you get a 2^nd and 3^rd opinion. Always shop around.

Preparing for the Application

Have all your documentation together ahead of time – bank statements, pay stubs, income tax returns and W2’s. Make sure to document any credit history issues so the lender can understand the reason for the late payments or other issues. Be as honest and straightforward as you can. You may also wish to provide a list of any credit references not on your credit report. For example, if you rented an apartment for a long time and always paid on time and that does not appear on the report, have your landlord write a letter of reference that you can include in your application.

Summary

Knowing your credit score and the kind of loan that will fit you the best is half the battle. When you know in advance what kind of product will work best for you, you will be able to comparison shop more easily and not be swayed by a quick pre-approval.

In the next article, we will be discussing car loans for people with bad credit.

Bad Credit Loans | Part Three: Car Loans for People with Bad Credit

For reference, the entire series of articles is listed below.

Bad Credit Loans | Part One: Loans for People with Bad Credit
Bad Credit Loans | Part Two: Mortgage Loans for People with Bad Credit
Bad Credit Loans | Part Three: Car Loans for People with Bad Credit
Bad Credit Loans| Part Four: Personal Loans for People with Bad Credit
Bad Credit Loans| Part Five: Bad Credit Refinance

photo credit: rutlo

Overview

Most of us have had financial hardships at least once in our lives. It doesn’t take much to upset the normal flow of finances – a loss of a job, unexpected medical expenses, auto accident – in my case, it was the unexpected closure of my small business. Regardless of the cause, bad credit is one of those things that many of us have to deal with. Just because you’ve got bad credit doesn’t mean that you don’t have the same financial needs everyone else does when it comes to borrowing. It just means that in order to get a good rate, you have to work a little harder and a little smarter. You may also have to look at bad credit loans as more of an opportunity to meet your financial needs while rebuilding your credit.

What is your situation?

Before you start your search, know what kind of loan you need. Are you looking for personal loans for people with bad credit, or a bad credit refinance? Knowing the type of loan you need will speed up the process of finding the right financial solution for you.

Know your Score

Regardless of the type of loan you need, the first thing you should do is know your credit score. Order your credit reports from all three reporting agencies – Equifax, TransUnion and Experian. You can usually find a way to get these reports for free, especially if you have been turned down for credit in the last 30-90 days. Once you’ve got your credit report, look at it for errors and be sure to write to each credit agency to report the errors right away. Know the meaning of credit scores and use that knowledge to improve your credit. Your credit score will be a factor with almost any loan you apply for, but will be most critical for home loans for people with bad credit.

Have a Plan

When you start shopping for a bad credit loan, have a rough idea of what you’re looking for. If you need student loans for people with bad credit for example, know when you expect to be able to start making payments. You probably don’t want to sign up for a loan that requires you to begin making payments when you’re still attending classes. If you are looking for car loans for people with bad credit, have in mind the price range of the car you’re thinking about buying. With all loans know the upper limit of what you can afford in monthly payments.

Shop Around

Most financial needs are immediate. You have pressing bills or expenses that need to be paid now. It is very tempting to take the first loan that you qualify for. It can make a huge difference though to shop around – especially for mortgage loans for people with bad credit.  Small differences in interest rates or closing costs can cost you thousands of dollars over the life of a loan. Auto loans for people with bad credit can be costly as well – know in advance the total cost of financing your new car and the total monthly payments. Don’t forget to factor in insurance on a new vehicle – newer cars generally cost more to insure and can come as a surprise later on.

Summary

Bad credit doesn’t have to be the end to borrowing. You just have to know your situation and be prepared to look for the right product to suit your needs. Once you find the right loan for people with bad credit, think about how you can restructure your finances to improve your credit to eventually get better rates.

In the next article, we will be going into more detail on a particular type of bad credit loan – mortgage loans for people with bad credit.

Bad Credit Loans | Part Two: Mortgage Loans for People with Bad Credit

For reference, the entire series of articles is listed below.

Bad Credit Loans | Part One: Loans for People with Bad Credit
Bad Credit Loans | Part Two: Mortgage Loans for People with Bad Credit
Bad Credit Loans | Part Three: Car Loans for People with Bad Credit
Bad Credit Loans| Part Four: Personal Loans for People with Bad Credit
Bad Credit Loans| Part Five: Bad Credit Refinance

photo credit: mangpages

• Know your credit score – the more prepared you can be going in, the better you will be able to negotiate and find the right loan.
• Before you start shopping for a house, know how much you can afford. That way you won’t fall in love with a property that is more expensive than your pocketbook will allow.
• Investigate the types of mortgage loans for bad credit that are out there – and determine the right type of loan. If you can do this before you talk to your mortgage broker it may be easier to keep from getting swayed by another loan product.
• Find a good mortgage lenders for bad credit by talking with friends and family, and also check with your real estate agent. Build up a good rapport with the broker – they will become your advocate.

Once you have your mortgage – there are some things you can do to get the most out of it.

• Start working on repairing your credit. Refer to article two about credit scores where we discuss what kinds of things impact your credit and how. Make sure to correct any credit report errors, start paying down existing credit cards or lines of credit.
• Make sure to always pay your bills on time. Many people find it helpful to set up automatic bill payments for the minimum amount so that payments are made without having to think about it.
• Put in some elbow grease and improve the value of your home. It will be easier to get refinanced with better terms if you have built up equity in your home. Keep on top of routine maintenance, make some cosmetic improvements and keep records of everything you do to improve the property.

Mortgage loans for people with bad credit have received a lot of negative attention in the media recently. Don’t let anyone make you feel bad about your situation. We all have gone through rough financial times.

Remember, there is nothing wrong with mortgages for people with bad credit – they are stepping stones to get you into a home of your own, help you start building equity, and give you an opportunity to rebuild your credit and eventually qualify for a mortgage with better terms.

I hope you’ve found this series on bad credit mortgages to be helpful – if you have, I would love to hear from you.

Here is the list of all the articles in this series:

Ins and Outs of a Bad Credit Mortgage | Part One: What are Bad Credit Mortgages?
Ins and Outs of a Bad Credit Mortgage | Part Two: Should I Repair my Credit?
Ins and Outs of a Bad Credit Mortgage | Part One: How Much of a Bad Credit Mortgage Loan can you Qualify For?
Ins and Outs of a Bad Credit Mortgage | Part Four: Types of Mortgages for People with Bad Credit
Ins and Outs of a Bad Credit Mortgage | Part Five: Finding the Best Bad Credit Mortgage Lenders
Ins and Outs of a Bad Credit Mortgage | Part Six: Getting the Most out of Mortgages for Bad Credit

photo credit: rutlo

When you shop – ultimately you’re shopping for the best loan, but you also want to find a bad credit mortgage lender that you can work with. This process can take 30-60 days or sometimes longer, so be sure you are working with someone who will follow through, and who you can get along with.

Online Mortgage Lenders for Bad Credit

There are some plusses and negatives in shopping for a bad credit mortgage online. The drawbacks are that it’s much harder to build up a personal relationship with the person on the other side of the internet. If you can, try to make some kind of personal contact via phone. If that isn’t possible, try to build a rapport over email. Ask them if they like their job and how long they’ve been doing this type of work. Ask them to share with you their funniest story relating to finding someone a bad credit mortgage.  If you can build a personal relationship, then shopping for a bad credit mortgage lender over the internet can be a great way to go.

The plusses are that you can quickly compare a lot of different loans, apply online and get feedback instantly. You can use their online tools to determine how much you can qualify for and what kind of interest rates you can expect to get. You can also track your application’s progress online and in most cases, the response time is fairly short.

Brick and Mortar Mortgage Lenders for People with Bad Credit

Applying for bad credit mortgages can be a time consuming process, and often there are a few times when you have to meet with your broker. Having someone local that you can work with can be an asset – if you can find someone you enjoy working with. It’s particularly nice to be able to pick up the phone and make a call if you have a question – and to know you are dealing with a real human being instead of an automated system.

Make sure you ask what kinds of loans they handle. Some brokers specialize in subprime loans, while others are FHA and Fannie Mae approved brokers. The more types of loans your broker or lender can offer, the better chance you will have of finding a loan that meets your needs.

Finding a Mortgage Lender for People with Bad Credit

Ask your friends and family members for referrals – who did they go through when they purchased their home? Ask co-workers and other people you see on a semi-regular basis, like at your child’s school  or little league. Often your real estate agent will have a long list of people they can refer you to.

You can also do a search online and compare rates and information from various companies. Be sure to find out exactly what kinds of loans they are authorized to present and always read the fine print. If you need an added layer of security, never hesitate to take your paperwork to your attorney to have him review it before you sign anything. Mortgages will cost you hundreds of thousands of dollars – spending a few hundred to make sure you aren’t missing any important details can be well worth it.

In the last article of this series, we will be discussing how to get the most out of mortgages for bad credit.

Ins and Outs of a Bad Credit Mortgage | Part Six: Getting the Most out of Mortgages for Bad Credit

Here is the list of all the articles in this series:

Ins and Outs of a Bad Credit Mortgage | Part One: What are Bad Credit Mortgages?
Ins and Outs of a Bad Credit Mortgage | Part Two: Should I Repair my Credit?
Ins and Outs of a Bad Credit Mortgage | Part One: How Much of a Bad Credit Mortgage Loan can you Qualify For?
Ins and Outs of a Bad Credit Mortgage | Part Four: Types of Mortgages for People with Bad Credit
Ins and Outs of a Bad Credit Mortgage | Part Five: Finding the Best Bad Credit Mortgage Lenders
Ins and Outs of a Bad Credit Mortgage | Part Six: Getting the Most out of Mortgages for Bad Credit

photo credit: woodleywonderworks