Many of us have had some financial problems at one point or another in our lives. Unfortunately, it takes much more time to fix these issues than it does to create them. If you are one of the millions of people who are having mortgage problems from the past haunt today, there still may be hope.
Our homes are usually the single biggest investment we make and the mortgage loan is usually the hardest type of loan to get for the average consumer.
For that reason, your credit score will be even more important than normal. To overcome mortgage problems from the past haunt today you do have some options but I’ll warn you, you may not like some of them.
The most obvious thing to do is to take the time (it could be several years) to get your credit score back where it needs to be. If you do, you won’t really have to worry about the past.
Most lenders are going to get a current credit report and that is the number they will base their decisions on.
Even if you had some rough times in the past, it shouldn’t be an issue as long as they aren’t evident on your current credit rating.
Another option that may work is to find a mortgage broker. These professionals have multiple lenders that they work with.
That flexibility may make it possible for them to find someone who is willing to loan you the money even if your credit report has some dings on it.
A word of warning though, even if you are able to get a mortgage with so – so credit, it will cost you a lot more. You will pay more in interest on that loan.
Having to pay more in interest can translate into more than just a higher payment. You may find that your monthly payment is higher yet you are getting less house for that payment.
Mortgage brokers will also charge you a premium for their services. Just make sure you take these things into account before you start the process.
It will probably make more financial sense for you to wait until you can improve your credit score but if you simply can’t wait, you may still be able to get a mortgage.
Another thing that can help a lot is having a big down payment. Putting more money down means that the lender is on the hook for a lot less.
That means they are taking on less risk and that makes it more likely that they will lend you the money in the first place.
So even if your credit isn’t that good, having a big down payment may be enough to help you get a loan and possibly even a little bit better rate.
No one is perfect and we all have had situations that we have had to deal with, if those situations have had a negative impact on your credit rating, don’t give up.
With a little time, effort and planning you may be able to work past mortgage problems from the past haunt today.