Bad Credit Home Mortgage Loans
Apply for a Loan
Secured with SHA-256 Encryption
UPDATED: Sep 12, 2011
Advertiser Disclosure: We strive to help you make confident loan decisions. Comparison shopping should be easy. We are not affiliated with any one loan provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about loans. Our goal is to be an objective, third-party resource for everything loan related. We update our site regularly, and all content is reviewed by experts.
Bad credit affects consumers and homeowners across a variety of demographics. While security loans can be more difficult with a lower credit score, there are many options for borrowers with blemished records. Home mortgage loans can be secured even with bad credit, though the severity of the credit rating is likely to contribute to higher interest rates, stricter repayment terms or higher down payments.
A mortgage loan is backed by the collateral of the property itself, so lenders are able to offer mortgages with greater confidence than unsecured loan types. The value of the home, along with the size of the down payment and other considerations such as the borrower’s income are all part of the consideration process for lenders deciding whether or not to approve a requested mortgage, or to extend a certain interest rate.
In some instances, would-be homeowners can improve their chances of securing an attractive home loan by taking certain steps to improve their overall credit profile prior to application. Such steps may include saving or securing funds for a larger down payment, increasing household income, paying down existing sources of debt and reviewing a personal credit report to identify any entries that may be outdated or incorrect. Additionally, some lenders may direct borrowers to debt consolidation or credit counseling services to help them restore fair credit if the loan is rejected.
Bad credit may increase interest rates on mortgage loans by several percentage points, but finding financial help for purchasing a home is possible with bad credit as long as buyers understand how their credit affects lender decisions.