Having less-than-perfect credit can greatly affect the interest rates on loans and purchases. If you’re interested in buying a home but are worried that your bad credit may get in the way, here are a few tips to give you some peace of mind.
Gather all documents that you may need before you see a lender. It’s in your best interest to bring all of your tax forms and any documentation relating to major purchases. Being prepared with these documents will help show your lender that you’re responsible, leaving them with a more positive outlook about your situation.
Have a Cosigner
A cosigner is a great way to combat a poor credit score or not having an established credit history. However, keep in mind that having a cosigner also means that they are also financially responsible for the loan; if you default on the loan, it becomes their problem too. If you have a cosigner in mind, be sure they have a good credit history and are aware of the liability associated with this decision.
FHA Loans are mortgages provided through the government. They’re more accessible for some, because they typically have a lower credit score requirement than traditional loans. Buying a home with bad or no credit may be difficult, but these informative tips will help you with your research.