How to find the best Bad Credit Mortgage lenders
Most lending institutions have strict requirements when it comes to lending. The reason may be simply because lending is risky. Lending to a person with bad credit is even a lot riskier. And this is why it is quite challenging for people with bad credit to obtain loans. However, if you have bad credit, it should not signal the end to your dreams of owning a house. There are lots of home loans for bad credit most of which are funded by government agencies such as the Veteran’s Administration (VA), the U.S. Department of Agriculture (USDA), and the Federal Housing Administration (FHA). There are more lenders willing to give credit to those with bad credit.
To locate them better and be more prepared, here are some tips.
Understand the major players
This will help you navigate the crowded fields and sift through the crowd. Some of the most common types of home lenders include:
- Credit unions: They are member-owned financial institutions and often offer favorable interest rates to shareholders. Many have eased membership restrictions, so it’s likely you can find one to join. They may also have more tolerance for your bad credit since you are already their member.
- Savings and loans: This was once the bedrock of home lending, although scarce now.
- Mortgage bankers: These work for a specific financial institution and package loans for consideration by the bank’s underwriters.
It is important to ascertain that the lender you seek is registered and you can do it through the Nationwide Multistate Licensing System Registry. Another place to look is the Better Business Bureau for unbiased reviews and information.
Use online resources
Luckily, we live in a digital age where there is access to a lot of information even from home. Therefore, you can make use of the internet to investigate various bad credit lenders and even compare their rates and taxes.
3. Ask family and friends
We must utilize our network appropriately when it comes to finding bad credit lenders. You may be surprised at how much your family and friends know about the services that you seek. So, don’t be quick to dismiss them or be too afraid to ask if they know any bad credit lenders. This also includes coworkers, neighbors, acquaintances, and even strangers. Do not hesitate to ask questions from them, they may be willing to answer.