Table of Contents
How Does My Credit Affect Mortgage Rates? 4
How to Get a Mortgage with Poor or No Credit 6
Pros and Cons of Using an Online Mortgage Lender 8
What is PMI and How to Get Out of Paying It 10
What to Look for in a Mortgage Lender 12
15 Steps to Financing Your Dream Home 14
Biggest Mistakes People Make When Getting a Mortgage 16
Can I Finance a Foreclosure? 18
Do this Before You Apply for a Mortgage 19
First-Time Homeowner Programs to Help Ease Financing 21
Sample Content Preview
Improving your credit score isn’t fast, but it can save your thousands of dollars in the meantime. Do the work now, to save yourself money later.
How to Get a Mortgage with Poor or No Credit
Nearly a quarter of Americans have a credit score under 600. The national aver-age of 675 is still too low to qualify for the best rates in conventional mortgages.
The good news is that there are programs aimed at getting people with low credit scores into home ownership. These programs include government programs such as FHA and VA loans but also online lenders such as Quicken and Carrington. How does this work?
1. Simply bypass a low credit score with a higher down payment. A higher down payment establishes instant equity and means that you have to borrow less money for a larger secured value.
2. Check into government-sponsored programs. The FHA loan, for example, does not require 20% down, but does require 3.5%, and has liberal qualification re-quirements. The downside is that FHA has a certain maximum, meaning you may need to buy less of a house than you’d hoped. FHA also requires Private Mortgage Insurance (PMI), a costly form of insurance to pay the lender if you default on the loan.
3. Understand your credit and what it means. Most lenders have been known to help people with poor credit get a loan. They look at other factors than just the number like cash flow, earnings, and your history of paying off loans. Understand though that the lower the score, the higher the interest rate. That means higher monthly payments and a much higher payoff amount by the end of the loan.
4. Fixing your credit is possible and may be easier than you think. Check your credit report. There are free services online that you can use to investigate your credit score. Find the black marks, work with the creditors to remove those marks against you.
5. Check for errors on your reports. Often, a mistake or error will show up on your report. If you’re buying a house, a higher score has large ramifications, so don’t let the mistakes stand. Get a letter of clearance from the lender who re-ported against your credit saying the situation was an error or that the amount has been covered.
6. Start these processes early, before ever making an offer, before shopping around from place to place. At least 90 days prior to making an offer, let the credit changes have a chance to change. A short delay now will save you a large sum of money over the next two or three decades as you continue to make pay-ments on your home.
Buying a home doesn’t have to be impossible on poor or no credit, but there are things you can do to increase your odds of getting a home loan. Do the work now, to save yourself big money later. And never give up hope. Homeownership might still be on your radar, even with little or no credit.
Pros and Cons of Using an Online Mort-gage Lender
With the advent of the internet, many traditional “brick and mortar” businesses are going online. Today not only are books, tools, and movies available for down-load, but even mortgages are available online.
Why use an online mortgage lender?
Online mortgages can be much faster and even, on occasion, cheaper than stand-ard lending. Online loans can be applied for while watching TV or making dinner. There is no time-consuming one-on-one meeting with a lender, and the process is much simpler. And since the companies have lower overhead, you pay lower clos-ing costs. Plus, they often take customers with low FICA scores, ones that tradi-tional lenders turn down.
But when there is no personal contact, there is a greater risk of fraud. The relative anonymity of the internet means it’s easier to create dummy companies with out-rageous promises. This can be a way to mine for private information and even commit identity theft.
Some things to be aware of:
• You should NEVER have to pay for a pre-approval or a quote. While it is normal to pay a fee for an application, this is not done up front; it’s
something done far down the line. Be very wary of any lender who re-quires this up front.
• Just because they will allow you the preapproval, that doesn’t mean you can afford the loan. If you FICA score is low, you might be better off in the long run renting and paying off old debt. This will save thousands of dollars over the life of a 20-year loan.
• Be careful with online forms. Misreading a form or the instructions can create larger problems down the road. Even clicking ‘enter’ in the wrong place can result in being turned down as there is no one to assist in the completion of the paperwork.
Whereas the lack of assistance is the bane of the online lender, it’s the strength of the brick-and-mortar lender. Traditional lenders are aware of the lure of their online competitors and have increased the customer service levels to focus on what they do best, help you get that loan.
While an online service may offer one or two different options that are easy to apply for, a physical lender may have many more. Also, an online lender may have several options but relies on you to explore them, where a physical lender agent will actively look for the package you can live with and qualify to get.
Anytime you’re looking seriously into getting a mortgage; you need to shop around with different lenders. It’s a good idea to check online as well in addition to exploring physical options but do your research into anyone you trust with your financial information. Find out how their customers have done with them, what their track record is. As with any loan, do the legwork to save time and money in the long run.Other Details
- 10 Articles (PDF)
- 1 Ebook (PDF), 23 Pages
- 10 Audios (MP3)
- Year Released/Circulated: 2018
- File Size: 132,365 KB
[YES] Can use
[NO] RESELL OR GIVEAWAY