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Credit Problems? Today's market
realities
MOST lenders don't like people with bruised credit.
Traditionally, if you have bad credit, you couldn't get a loan.
From about 2001 - 2006, lenders opened the door to many people
with weak credit to get financing. Unfortunately, so many of
these people failed and ended up in foreclosure, that it once
again is very hard for someone with bad credit to get financing
unless you have a really big down payment or equity position
(20% or more).
What’s Your Credit Grade?
Every lending facility uses guidelines to determine your credit
worthiness. Upon reviewing your application, you’re given a
credit grade and a determination regarding your loan’s approval
or denial. MOST lenders DO NOT give loans to those with bruised
credit. If you are denied by a lender, please contact us. You
may be surprised at what you hear. Click here for some general
criteria used within the lending industry to determine credit.
CREDIT PROBLEMS & ANSWERS
Late Payments
If your credit has 30, 60, or 90 plus day lates, you may still
qualify. Especially if those late payments occurred more than
two years ago. If those late payments were recent, it will be a
big problem.
Collections
If your credit history indicates unpaid collection accounts, "A"
grade loan lenders will require these amounts to be paid off
before the loan is funded. We have programs that DO NOT require
these items to be paid off. Typically if they are under $500,
and more than 2 years old. Medical collection "usually" are
ignored. Judgments' (you went to court & lost), are REQUIRED to
be paid off before approval under 99% of all mortgage loan
options!
On the other hand, if these are the only "bad" items on your
credit, paying them off should is highly suggested as it may
allow you to qualify for an "A" loan.
Bankruptcy & Foreclosures
If your bankruptcy is more than two year old, but less than four, or your foreclosure was recorded at least three year ago, you may qualify for an FHA loan with as little as 3-5% down payment.
If your bankruptcy is older that 4 years,
and you have good re-established credit, you may now qualify
for an "A" loan.
High Debt Ratios
If your income-to-debt ratios are too high, you can either
reduce your personal debt (i.e., pay down your debt), obtain a
debt consolidation loan, pay down your debt with funds from the
sale of personal assets (boat, camper, etc.), select a lower
interest rate ARM loan, or add a co-mortgagor.
Is a debt consolidation loan for you?
If you have any late payments on your record, part of the reason
may be because of high credit card debt. If you qualify, you can
pay off all of your high-interest credit cards into a low debt
reduction refinance loan which may be tax deductible (unlike
credit cards, which are NOT tax deductible).
Even if you don't qualify for an "A" credit loan, you probably
still qualify for a non-conforming loan. Call us at (651)
552-3681. Speak to a mortgage professional who can help
determine your credit status - its a FREE service!
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Joe Metzler, MMS, UMB |
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Housing Lender - Our
services available only for properties located in
Minnesota, Wisconsin, and Florida.