Bad Credit Homes Loans… Yes! Can Can Qualify

Owning a home is a major life goal for most people. Unfortunately, it can be quite difficult if you have bad credit, and some people may feel inclined to approach a loan shark for their monetary needs. Coming up with the down payment can be difficult.  But, with effort and discipline, it’s absolutely possible to own your own home using bad credit home loans through legitimate means.

Face Your Credit Fears

First, know your credit. Credit scores can be obtained directly from the credit bureaus. Make sure you provide them with all of your financial information, including bank statements, tax returns, pay stubs, and whatever else relates to your financial situation. A credit score of 720 or above is spectacular, and 580 or below is poor. Maybe you have a low score and feel like you need a loan shark, or should take a bad credit home loan. But don’t fret yet, as the score can be turned around.

Honesty Is Key, Even For Bad Credit Home Loans

A lot of people have bad credit, and it’s something you can deal with, either by getting better credit or finding a decent bad credit home loan. Don’t worry, you won’t need a loan shark. Find out why you have bad credit by sitting down and talking with your banking credit team. Make sure to tell them everything about your financial history, for example, tell them about an illness that made you miss work, or tell them about when you had to take medical or family leave. Tell them everything, sometimes a note can be made on your credit history to explain why a non-payment occurred. Remember, everybody has hard times, and credit teams will understand that. Be open with them and tell them the truth.

Really… You Don’t Need A Loan Shark

You don’t need a loan shark if a family situation can explain your unemployment or missed work. The federal government has programs meant to help people with bad credit find work. The FHA has a loan program called ‘Back to Work’. If your unemployment can be explained by a family situation, this program might be able to help you. You’ll have to provide evidence to confirm your story, such as an unemployment stub, or a doctor’s medical statement. Unfortunately, this loan requires a higher down payment for homes, and carries a higher interest rate. If you can handle it, this is an option for you, instead of other bad credit home loans.

Clean Up The Mess

A great way to begin fixing bad credit is to pay bills on time. Just remember,  30 days late will put a real ding on your credit report and will make it difficult to qualify for a mortgage, even bad credit home loans. Paying 60 or 90 days late elevates the transgression from fender bender to major wreck. But they’re all real stains on your credit report. If you pay bills by mail, perhaps you might try paying them online. It’s faster, saves money on postage, and you can do it from home.

If you have more too much credit, you can talk to your creditors about scaling back. Cards you use at specialty shops typically have very high interest rates, so these might be prime targets. CAUTION: Closing older, more seasoned accounts can have a negative impact on your credit. Length of credit is a faction in your credit score.  It can also change your credit utilization ratio, another factor in credit scoring. As helpful as credit cards are, irresponsible use will really hurt  your credit score. You only need one or two in daily rotation, and perhaps an emergency card tucked away. Of course, make sure your payments are on time.

Keeping Your Dream Home

Know what you can afford. Mortgage payments will probably include taxes and insurance. So, don’t buy a home where taxes are high. Sometimes you need to make a few concessions to follow your dream, but don’t feel like you need a loan shark. Decide what you want and what you can sacrifice. Find ways to help your credit, or find a bad credit loan. Owning a home isn’t out of your reach, and fixing bad credit is an important step!