Getting a mortgage loan with bad credit can be a challenge, but it’s not impossible. Here are the steps you should take to get a mortgage loan with bad credit:
1. Take time to understand your credit score. Knowing your credit score, and what has affected it, is the first step to improving it. If you don’t know your credit score, you can get it for free from most credit bureaus.
2. Determine the type of loan that best fits your needs. Different loans have different requirements, so carefully consider what type of loan is best for you.
3. Look into government programs. Programs like FHA or VA loans are backed by the government and may be easier to qualify for with bad credit.
4. Improve your credit score. Many potential lenders will look at how you’ve managed your credit in the past. Improving your credit score can go a long way in helping you get approved for a loan.
5. Connect with lenders. Speak with a number of lenders to see who will be the most willing to work with you. Compare interest rates and terms to ensure you’re getting the best deal available.
6. Start saving. Even if you don’t have the best credit score, having some money saved can increase your chances of being approved for a loan.
7. Get pre-approved. A pre-approval letter from a lender shows other lenders that you’re serious about getting a loan and may help when it comes time to make an offer on a home.
8. Make an offer. Once you find the right loan for you, make an offer on the home of your dreams.
9. Submit your paperwork. Make sure all required paperwork is submitted on time and accurately.
10. Close the loan. Congratulations! You’ve now made it through the process of getting a mortgage loan with bad credit.