Buying a home with bad credit.

Less than perfect credit is okay for buying a home!

Buying A Home With Bad Credit is still a possibility for those who have fixed their credit problems from that past and are ready to better themselves with a bad credit home loan. We all have rough times and lets face it, life can be rough but don't let bad credit hold you back from buying a home or refinancing to a lower interest rate. Speak with a mortgage professional by calling 800-555-2098 to see what low score mortgage options may be available for you.

For more information on Buying A Home With Bad Credit programs from Riverbank Finance LLC, call us at 800-555-2098 or apply online today!

Home Loans with low credit scores down to 580

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    Tips to improving your credit score to buy a home

    How can I buy a home with bad credit?

    For details on Credit Scores view the Federal Reserve's 5 Tips for Improving Your Credit Score. Check your credit score online instantly with our Instant Credit Report Online.

    Pay your Bills On Time

    There are several ways you can boost your credit score to buy a home. The main thing is to pay your payments on time for the preceding 24 months before buying a home with bad credit. Most creditors do not report you late until you are 30+ days behind so do whatever it takes to get the payment in before it hits 30 days over due.

    Do not max out your credit cards to avoid bad credit

    Be sure not reach the credit limits on your credit cards and charge accounts. This is one factor that will devastate your credit. For example, if your credit card has a limit of $1000, do not charge anything more then $500 on that particular card. A rule of thumb is to keep your credit cards under the half way point. This will bump your credit rating!

    Do not apply for New Credit

    Having credit is a good thing, it can prove you can be responsible to pay your bills on time and better your finances. When your credit is bad however applying for new credit can negatively affect your credit score. Do not apply several places for credit when you have been declined. This will drop your score each time and several credit inquiries look bad to banks and lenders.

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    How to buy a home with bad credit home loans

    What is the minimum credit score to buy a home?

    The minimum credit scores to buy a home with bad credit may vary from bank to bank and lender to lender however a general rule of thumb is to have a 580 or higher credit score. Your credit does not have to be perfect with programs such as the USDA Rural Development home loan and the FHA Home Loan. Other things to avoid are recent bankruptcies, foreclosures, collections, late payments and judgements.

    What is considered a bad credit home loan?

    While many people label mortgage programs by what they do, there is not necessarily a program called a bad credit home loan however you can use great government insured programs such as the FHA purchase mortgage to buy a home with poor credit. The Federal Housing Administration technically sets their minimum credit scores at 560 with a 10% down payment however most lenders add overlays to make their minimum credit score a 580 and require only a 3.5% down payment. The FHA loan type is typically best for buying a home with bad credit because it allows you to purchase a house with only 3 years after foreclosure and 2 years out of bankruptcy. A chapter 13 bankruptcy may allow you to buy a home with 12 payment complete while still in bankruptcy with court approval.

    Common causes of bad credit when buying a home

    Several factors can cause you to have bad credit when buying a home including the following:
    • Late Mortgage Payments
    • Late Credit Card Payments
    • Recent Collections
    • Bankruptcies
    • Home Foreclosures
    • Judgements
    • Excessive Credit Inquiries
    • High Debt Ratios

    It is best to take it slow when purchasing a home with poor credit so you do not make things worse. Do not have several banks pull your credit as this can negatively affect your credit scores. It is very important to high the highest credit scores you can so you qualify for the lowest interest rates and low closing costs.

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