How can you buy a house if you have bad credit?

Answer

Answer

There are many mortgage company who specialize in working with consumers with no credit history or bad credit. Do some research and talk to a few mortgage professionals in your area. You need to get a clear picture of where you stand and what steps you need to take to achieve your goal of home ownership. As a credit repair specialist, there are few people who cannot get where they need to go in terms of financial goals. It is usually just a matter of taking the necessary steps and time.

Mortgages Answer

Please ignore the answer from this individual. they are simply bringing your hopes up.

the simple fact of the matter is, you cannot get a houseloan with bad credit. end of story. take it from someone with a FICO mid of 530 and several collections, as well as an income/Debt ratio of 102%. this is the definition of bad credit. i have been conducting an experiment where i have contacted about 10 or 15 lenders(both local and nationally, starting with my bank)concerning a purchase loan. i have specifically targeted companies who say they can help with "less than perfect" to "bad" credit. they have made a platform to which anyone can step on board and get that dream house. that platform does not exist, no matter what they tell you. it simply does not exist. out of the 10 or 15 companies i talked to(and 1/2 of them did not even call back) they could not approve me, even if i had 20% to put down on a house. Fannie Mae does not even help in this situation.

the best way to get a house if you have bad credit is to clean up your credit and wait at least a year, then go through your bank for a mortgage. this is the only way to get that dream house. DO NOT BE FOOLED~ for the record, the places i have tried are: ditech,ameriquest,crossover,american south,quicken,lendingtree(which did not even process my request)and my local bank.i have also tried exclusive "online bad credit mortgage" places and they did not even get back to me.

SO, please do not waste your time listening to anyone who tells you that you can get a house with bad credit. they are lying to you. remember: heal your credit(pay off collections, reduce your debt) and wait for at least a year, then try for it. good luck. -D

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I've been doing mortgage lending for a little over a decade now. There are some government sponsored programs that allow borrowers with bad credit to qualify for a mortgage loan, (i.e. FHA). The only problem you will find yourself bumping into time after time is that although FHA has no FICO score requirement the actual bank that you will be submitting your loan application to, will. This means that we are back to square one where credit does matter and really bad credit will get you nowhere, even if your DTI (debt to income) ratio is good. You will hear some so called "mortgage experts" say that there are compensating factors that will enable you to qualify with bad credit. Although, there is a certain level of truth to this, fact of the matter still remains that if your score is very low and your credit history is very bad you will NOT get a mortgage loan.

I can understand the point of view of there always being a lender out there that is willing to finance anyone for the right price, but friends believe me when I say, "those days are over; at least for a very long time." This is the reason the real estate industry is in such turmoil. Lenders and Investors were ill advised and it was just a matter of time before the inevitable happened, (sub-prime meltdown).

I monitor the mortgage market in Wall Street daily. I keep tabs on real time pricing and on how mortgage bonds are selling. I make it my business, as many mortgage professionals should, to understand how the economy nationally and globally affects mortgages. I say all of this so you can take it from someone who truly knows what they're talking about. Unless you are willing to put a down payment of 30% to 40% of the purchase price or have the same amount of equity in your home, and pay an interest rate of 11%-18% +, YOU WILL NOT GET A LOAN.

There is still hope for those with bad credit. With the right mortgage professional by your side you can clean up your credit to a point that you can qualify for a mortgage loan. It will take time and perhaps some money to payoff or pay-down certain thing you owe, but at the end owning a home is much more financially and emotionally rewarding than renting. Best of luck to you all.

First answer by Linh Le. Last edit by JCLN. Contributor trust: 10 [recommend contributor]. Question popularity: 185 [recommend question]