When applying for a mortgage loan when you have a bad credit history. There are a few things you should know about your FICO score that will help you know what to expect from mortgage lenders.
With a credit score below 585, you will need to put at least 10-20
s a down payment on the property. You will not likely be approved for 100 inancing at this point.
If you have a credit score of between 585-599, you will probably need around a 5
own payment in order to get an approval for a home mortgage loan. You will still need to get your approval from a subprime mortgage lender. You will need to use a lender who specializes in loans for people with “less than perfect credit” or situations that make it difficult for a person to get financing for their home.
If you have a credit score of 600 – 620, you will probably be able to get an approval for 100 inancing. You will also, in this situation, still need to use a subprime lender.
With a credit score of 620 or higher, you may be able to not only qualify for 100 inancing, but be able to get a lower rate of only 1 – 2 percentage points above the prime rate.
If you have a recent bankruptcy or foreclosure, these estimates should still be accurate within 2 years after bankruptcy, repossession or foreclosure. After 2 years, it becomes easier to get approved for a mortgage loan, because more lenders will look at financing you after 2 years, whereas many lenders will not even consider your application until 2 years from the time of bankruptcy discharge or a foreclosure. After a 3 year mark from the time of bankruptcy or foreclosure, it becomes even easier to get an approval, in that many more lenders will consider your application after 3 years.
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