So you have a bad credit score and looking for buying a home.
Many people have a bad credit score and the reason could be anything – poor cash flow, not spending smartly, leaving jobs frequently, etc.
This blog will be helpful for all those who have a bad credit score and need bad credit home loans.
So let’s get started!
Firstly, Know at what Level you are
Before you find out whether or not you are eligible for a home loan, let’s discover what is your credit score?
The below table contains the data of various credit levels.
|Score Range||Credit Level||Mortgage Implications|
|800 – 850||Excellent||The topmost end of the credit score range. You have a higher chance of getting a loan.|
|720 – 799||Very good||Not at the most top of the mountain, but you are still likely to get a loan and get better interest than the below listed.|
|620 – 719||Good||So good so far, you can still get your loan approved. You will pay higher rates on the bases of risk factors; however, you still have good chances of getting the loan.|
|580 – 620||Fair||You are capable of approving for an FHA loan by various lenders, but you will require carrying fewer debt and pay a bit higher interest rate.|
|<580||Poor||This is considered a subprime level. This means lenders will not approve of your loan application. You might not be qualified to pay the down payment and you need to pay installments every month without any delay or gap.|
So at what level you are?
Your credit score plays a major role in getting a home loan. Therefore, know your credit score first before even hiring experts to apply for a home loan.
Home Loan with Bad Credit Score
You still have chances to get a loan. However, it’s crucial to examine deeply the terms, potential risk and interest rate.
The subprime loan has higher rates and less favourable terms than other score levels. However, even if you have qualified for the loan, it’s important to know the expected downfalls. In subprime loans, a missing instalment payment has a penalty (which might not be the case with other levels).
Apart from the home loan, you have other expenses as well such as Mortgage Broker Perth fee. You simply can’t apply for any random amount that might not even cover all the expenses and you got stuck paying it for years.
How to Buy a Home with Bad Credit Score?
Have a word with your Home Loan Experts or Lender – Ask how can they help you and what is the best way of buying home with a bad credit score.
Liquidate Assets – Sell your assets to add more money to your budget or savings
Apply individually (if you are married or engaged) – If you are married or have a partner to buy a home with, try to apply individually. If you are not getting approved for the rent, they might get approved on the other hand.
Ask your family or friend for help – Ask your family or friends to lend you some money that you can repay after a few months or years. This is the best choice as you will not have to pay any interest or down payment because they are lending you money on a trust basis. So ensure that you repay under or before decided time.
So that’s all about the bad credit score home loan!
It’s time to get in touch with the leading professionals who know how to avail you Low Deposit Home Loans easily.
So do it right now!