How to Purchase a Home with Bad Credit

July 24, 2018

 

Buying a home, for most people, is the most expensive purchase they will ever make. Everyone deserves their shot at the American dream, and very few people go without a few bumps on their credit history. It is possible to get a mortgage with scores as low as 600- 620, however the lower the score, the higher the interest rate and additional fees, such as PMI (private mortgage insurance) that can add over 100$ extra to your mortgage payment every month! 

 

So you've heard the bad news. Here's the good news: you don't have to settle! If you're serious about purchasing home the near future, you've started to look at your finances. Even on a tight budget, it's possible to start saving money to use for a down payment. Saving money is a part of the battle, but even with a sizable savings, lenders won't give good rates on a loan unless your credit report proves to them you are low-risk. 

 

The next big question is, what do you have to do to raise your credit score? Waiting 7 years (or sometimes longer) for negative/accurate items to be removed from your credit is not only untenable, but for some it is not an option. Whether due to divorce, change in employment, or other extenuating circumstances, sometimes buying a home is a necessity and time is of the essence. 

 

Yes, it is possible to dispute items yourself, even online with the simple click of a button. However, if you don't follow through correctly, or even if you make headway but they aren't completely removed, you'll end up hurting your mortgage potential even more. Lenders are even more likely to deny loans to consumers who have items in dispute. There's also the potential for those items to end up staying on your credit even longer (see our article titled: Why Disputing Your Credit Online Can Hurt More Than Help). 

 

The next step is deciding you ( and your future) are important enough to fight for with professional help. That's where we come in. Select Us LLC is not your average credit repair company. We work exclusively with clients looking to buy or re-finance homes and have decades in the credit industry as well as in the housing industry. Not only do we provide help for repairing your credit history but we will be with you every step of the way to maintain and build positive credit moving forward.

 

We provide accelerated results for people serious about buying and saving money on their mortgage. Even if you have a score of 650, and can potentially get a loan on your own, it's worth it to restore your credit further.

 

Example: someone with a credit score of 650, who gets a 30-year, $400,000 mortgage, could pay over $70,000 more in interest than someone with a 750 credit score. Over a lifetime of borrowing, the 100-point gap in scores could cost $201,712 in extra interest payments!

 

If you have any questions about the pre-approval process or intensifying lender standards, our specialists are happy to help. We offer FREE consultations including an in-depth credit analysis to pinpoint the problem areas and develop a plan for you specific situation.

 

Contact us today to find out more and take control of your credit, and your life!