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Buying a Home with Low or Bad Credit.

Low or bad credit can seem like a monstrous mountain between you and your desired future. You feel like your only option is to pop a tent and get used to the uncomfortable ground you’re lying on. But what if that mountain ahead wasn’t as large as it seemed?  Perhaps you would strap on your best boots, and trek your way over it! 

Here are five hopeful pieces of info that will motivate you to take the first step towards conquering the mountain!

 

1- Credit Scores Improve

 Yes, credit scores can drop, but they can also rise. If you have low or bad credit, here are a few tips to start you down the credit score improvement path.

  • Correct any errors on your credit report. Believe it or not, there are a lot of mistakes out there, and they can certainly take a toll on your score.
  • Reduce your debt to income ratio. Get serious about paying down debt. If you’re willing to work hard and chip away at the block, you’re sure to improve your credit.
  • Try not to let your credit card balance be more than 30% of your credit limit.
  • Feeling exhausted after just thinking about the above tasks? Consider hiring credit repair professionals. It may not be as expensive as you think. Please do check that they have a licensed attorney who will be able to represent you.

 

All that being said, be relieved that…

 

2- Your Credit Score is Not the Whole Shebang

If you are trying to buy a home then yes, credit scores are one metric lenders use when deciding whether to lend to you. But the good news is, there are other factors at play. The size of your down payment and your debt to income ratio are also two factors they use to consider. Let’s say that you’ve been making steady payments over the last 12 months and your credit score hasn’t bounced back up yet. Lenders will take note of this, so stay on top of things!

3- Vylla Helps Low Credit Buyers

With a credit score of 500 and just 10% down, becoming a homeowner is a reality for many of our clients. And if you have a credit score of 580 or higher, you may qualify to put only 3.5% down. Start picking out some home décor.

4- Higher Down Payment = Better Deals

As mentioned in #2, your credit score is not the only thing that matters. A large down payment goes a long way. If your circumstances have recently taken a turn for the better, and/or you can afford a large down payment, you may be in luck. The bigger the down payment you can make, the likely it is that you will get the loan you apply for.

5- Time Heals All Wounds

The fair credit-reporting act states that the longest any derogatory information can remain on your credit bureau file is seven years. Of course, paying your bills on time helps from that point on, as well. The takeaway… bad credit is not with you forever.

 

Buying a home with a low or bad credit score is not impossible. In fact, today it’s more doable than ever. Ready to get started? Click here to find if you qualify

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