A number, roughly between 300 and 850, that summarizes a consumer's creditworthiness.
The higher the score, the more able and willing a consumer is to repay a loan, lenders believe. The best mortgage rates and terms go to borrowers with credit scores of 740 and higher. Generally, a "low" credit score is in the "fair" to "poor" ranges below.
Lenders are typically more lenient with credit qualifications for borrowers who opt for government-insured Federal Housing Administration loans.
If you can find someone to co-sign for your loan, you could avoid a bad credit mortgage altogether. Keep in mind, however, that this agreement means that you will be putting a family member or friend on the hook for your debt. If you default, both you and your co-signer will suffer the consequences.
Of course, the best way to get a mortgage after you’ve don’t some damage to your credit is to wait until your score improves. This ensures that you’ll get the best possible interest rate on your mortgage, and will help you avoid the predatory lenders that tend to take advantage of borrowers with few other options. Besides, if your bank won’t give you a mortgage because your credit history suggests that there’s a high risk that you won’t repay the loan, you have to ask yourself whether that assessment is accurate given your financial background. A mortgage is a huge financial responsibility that spans many years.
If you already struggle with staying on top of your debts, do you really want to add a mortgage to the mix?
Read more: http://www.bankrate.com/finance/credit/low-credit-score-borrowers-get-mortgage.aspx#ixzz4cjjIcVCk
Follow us: @Bankrate on Twitter | Bankrate on Facebook
Read more: http://www.dividend.com/my-money/bad-credit-8-ways-to-get-a-mortgage-anyway/