We have been talking about this since the beginning of this blog. Ladies and gentlemen, let me introduce you subprime mortgage lenders – these guys are easier to qualify with than most existing conventional or traditional lenders. What is really important (and I mean it!) is that even if you have a foreclosure or bankruptcy on your file, you can still buy a home and live in this world with a stable roof above your head. The second interesting aspect is that their rates are also quite competitive, especially if adding up several down payments and shop rates. The next three tips that I am about to share with you guys will help you get approved, especially if you are one of those people with low rate home loans. So, let’s begin.
1. Checking Your Credit Report is Crucial
Check this out folks. Paying extra interest rates for mistakes committed by your creditors is not only stupid, it is absurd. Verifying your credit report in your files for any errors or inaccurate information is a must do if you are serious about qualifying for a loan. Most credit report firms or agencies out there are directly responsible for fixing any mistakes, so letting them know in written form as soon as you have spotted the mistake is a must do. If you have the possibility you must also let the information provider know too.
Having a bankruptcy or a foreclosure issue in your financial past is something that most people experienced and there is no way to hide from something like this (well unless you change your identity 
. That’s why, when trying to get approved by any subprime mortgage lender company you have to make sure that you include a well (professionally) written letter in your report for a quality explanation of the situation that appeared. Most of the financing companies that I personally had the chance to deal with looked quite favorably and had nothing to say when dealing with a bankruptcy caused by a job loss, illness or injury. This is normal, they are humans too and they understand that it happens from time to time.
2. Never Underestimate the Power of a Down Payment
Yes folks, a down payment really helps and I’m not the first or the last one to mention this. Improving your application with an existing down payment is also real. You just have to know and to realize which method qualifies better. While ten percent (10%) is the most common, twenty (20%) will always act better and will get you approved for much better rates. If you do not agree please make sure that you mention why in the comments bellow this article. In order to succeed in getting approved you are going to need to understand how it works. You see, down payments always decrease the possible risks for lenders, that’s why they constantly rate your loan application differently. They also run a business and they are required to stay safe.
Paying off certain old debts and deleting unused accounts is also something that can be done in order to improve your credit score. Please take a piece of paper and a pencil and note down that by increasing the available cash reserves (when cashing stocks or other investments you have) you also have the chance to improve your score. This is how professionals do it and this is what you should also try if you are serious about reaching your goal.
3. Qualifying for Adjustable Rate Mortgages is a Joke
While most of the people don’t want to understand it, subprime lenders do offer a certain variety of financing packages and adjustable rate mortgages (ARM) are probably the easiest to qualify for. Try it for yourself if you don’t trust me. The reason that you are able to qualify for more is because their monthly payments are the lowest in the market (well at least in the beginning). By following the above mentioned tips and taking advantage of truly affordable interest rate you are going to be able to soon move in a new house; however, be aware that your payments can double or triple in a few years. Be aware!
Have you ever heard of smart shopping? This is a method used to locate the lowest costing loan out there. By comparing the adjustable percentage rate (APR) of certain mortgages you have the chance to stay out and not get caught by those nasty hidden fees that most people often stumble upon and basically have no clue what to do with. Even if you have a bad credit score and that ugly financial background of yours is giving you a headache, you should still look at traditional or also called conventional lenders, because who knows, you might have the chance to convince them and qualify. Many of those that I personally had to deal with are still providing quite interesting and competitive loans to those people with adverse credit scores. Can you imagine something like this? Anyway, just remember that any citizen of USA has the chance to improve his or her credit and lead it to a good standing never seen before point in approximately two years and by doing that to refinance for better existing rates.
To be continued…
Billy,
ChateauMortgage.com
