Getting a home loan with bad credit in 2013

DALLAS - Oct. 10, 2013 - PRLog -- With FHA loans available to borrowers with a 580 credit score, and HUD’s new back-to-work program (https://thelendersnetwork.com/back-to-work-program/) to reduced the waiting period to buy a home after a bankruptcy or foreclosure from 2-3 years, to 12 months. You most certainly can attain a home loan with bad credit.
But you’re going to pay more than a borrower who has perfect credit, but that is to be expected. The FHA guidelines (https://thelendersnetwork.com/fha-guidelines/) allow mortgage companies to lend to a borrower that has a 580 credit score, requiring just 3.5% down.

Dallas, TX 5:50pm October 10th, 2013 – Getting a home loan with bad credit doesn’t mean a ridiculous interest rate . You can expect a slightly higher interest rate than the current prime rate. However typically where you pay for poor credit on a mortgage is increase closing costs. Because these loans are more difficult for the lender to do and take more time you can expect an origination fee, plus an additional amount to buy down your interested rate to make the numbers work. It is beneficial if you have at least one strong compensating factor.

The Waiting Period After Foreclosure / Bankruptcy

New HUD back to work program allows borrowers to buy a home just 12 months after a bankruptcy, short sale or foreclosure.
FHA lenders can go down to a 580 credit score for FHA loans.
Conventional Mortgage options are available with 3% down and a 620 score.
VA Loans can be achieved with a credit score of 580 in some states.

Strong Compensating Factors:

Been at your current place of employment for 5 years or longer
Have a debt to income ratio 5% or lower than 43%
Have additional reserves in savings or investment accounts
Are paying your current rent on time and the amount is as much as your mortgage payment or higher.

If you have has some issues in the past and have bad credit now, do not rule out buying a home. Make sure you deal with the right lender that does not make false promises but knows their underwriting guidelines and can get your loan closed.

The Lenders Network is a free mortgage referral and agent referral company. (https://thelendersnetwork.com/) We do not sell information to several lenders. We review your situation and get you in contact with the lender that offers the right type of loan product that meets your needs.

Randall Yates
The Lenders Network CEO
randall@thelendersnetwork.com
www.thelednersnetwork.com