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Getting a Loan When You Have Bad Credit
By Kathy Johnson
California Mortgage Rate Columnist
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Do you have bad credit? Maybe even a bankruptcy? While these obstacles used to mean you'd have no chance of obtaining a home mortgage loan, that's no longer the case. Many options now exist for those who need a bad credit mortgage. But if you have less than stellar credit, how do you get a loan?
Building Credit with a Bad Credit Mortgage
According to several lenders, taking on a bad credit mortgage can actually help you to rebuild your credit. While the interest rate may be high on a bad credit loan, the advantages outweigh the disadvantages. Making your mortgage payments on time, for example, is a crucial first step in improving your credit.
Applying for a Bad Credit Loan
If you're interested in securing a bad credit mortgage, you'll need to make sure your credit report and score are accurate and correct any errors you might find. You are entitled by law to receive one free credit report per year. There are also websites available that can assist you in getting a copy of your credit report. In addition to an accurate credit report, you'll also need to show a steady income by providing pay stubs or deposit slips.
Next, check around for the best bad credit mortgage you can find. Talk to more than one mortgage broker about your situation, and find one you can trust. Also check the Internet - online lenders have many mortgage options for those with bad credit.
Even if you have bad credit, many options now exist that offer you the chance to secure a loan and achieve the dream of home ownership. A bad credit mortgage could be your first step towards good credit.
About the Author
Kathy A. Johnson is a freelance writer and editor based in Florida. She has worked as a writer and editor for several publications, writing articles on health and fitness, gardening, teen issues and other topics. She is currently the features editor of Forum, a bimonthly publication of the national mothers group, Mothers & More.
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