how to buy a house with bad credit
How to Buy a House with Bad Credit
If you just went through a foreclosure and witnessed your FICO score collapse, you might be forced to think that your dream of buying a house will never come true. The article below, therefore, tells you how you how to buy a house with bad credit.
- If you file for a bankruptcy, then you cannot file for another one for 7 years. Besides, the impression remains in your credit history for 10 years.
- You can avail better rates for a conforming loan only if you wait for 4 years.
- As per FHA guidelines, you qualify for as little as 3.5% down payment after 2 years of a foreclosure.
- Hard money lenders, who promise loans within 6 months of foreclosure often demand 35 to 40% down payment. Moreover, the interest rates are sky high and the terms of the loan are highly unfavorable.
- Since, you filed for bankruptcy in order to start afresh, your lender knows that you have no debts.
- Moreover, the fact that you won't be able to file for another bankruptcy for at least 7 years, drastically increases your chances of getting a credit card.
- You can consider this a chance to work upon your credit scores. All you have to do is, produce an evidence of stable employment for a couple of years and a steady income during those years (ignore these conditions if you are self employed).
- If you pay your bills and taxes on time, clear all your monthly debts ,and execute all your civil duties then you can influence the lender's decision to work in your favor.
- Lastly, make it a point to save at least 10% of down payment every month.