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    • Getting the Best Mortgage Rates in Florida with a Poor

      Date: 2010.04.18 | Category: Mortgage | Response: 0

      Getting the Best Mortgage Rates in Florida with a Poor Credit History

      Florida is a lovely place to have a house in; unfortunately the real estate prices are rather forbidding for most. And for someone with a bad credit past, it gets tougher. However, if Florida real estate has is in your dreams, you can still get a mortgage loan, even with a bad credit if you know how to look for it.

      Before we get into shopping for the best mortgage rates, let us understand how the credit score of a borrower determines the scope of his search. Most lenders will willingly lend to a person with A credit score but someone with a C or a D grade wont get so lucky.

      Fortunately, recent entries into the Florida lending industry have led the industry into being more liberal when approving loans. For instance, if there are more than 4 late mortgage payments in a period of 12 months, it calls for a B score, however if these delays have a plausible explanation the lender may excuse the default and consider a score of A.

      There are companies who specialize in giving loans to high-risk borrowers and they are known as Sub-Prime lenders. Even though loans from the Sub-Prime source continue to dominate the high-risk borrowers segment, the government-sponsored agency, Fannie Mae too is beginning to acknowledge the potential in this category. With the availability of more options, a borrower with bad credit can afford to get choosy and not jump at the first approval he gets for the fear of not getting another chance.

      The Internet is a good place to look for multiple mortgage options and even for specifically Florida Mortgage Loans, without the borrower having to reveal his credit status. One may even go to a mortgage broker in order to locate the best quotes, but they can be expensive. Ask for reference from friends and colleagues for a good mortgage lender, since a recommendation is always assuring.

      Once you narrow down your choice, here is a checklist that you must go through.

      1.First analyze your financial status, if you find you have come out of your past credit blues and can commit more you can consider an Adjustable Rate Mortgage (ARM). An ARM allows for a lower rate of interest in the initial years with an option to refinance at a lower, fixed rate after the first couple of years. However, if you find yourself financially burdened, a fixed rate payment would be more appropriate. Search, negotiate and settle for a rate of interest and for terms and conditions that suit your financial status.

      2.Find out how much penalties are imposed for pre-payment. Heavy penalties will take away the advantage of any timely payments that you may be able to make and that may get you a refinance on better terms in the next few months.

      3.Most Sub-Prime lenders exploit the vulnerability of high-risk borrowers and slap on high closing costs at the end of the loan. There are more lenders out there willing to do business than one would have you believe and a little negotiation can always add to some cost shaving.

      4.Avoid paying any upfront or processing fees; the only fee acceptable should the one you pay for your credit application.

      5.Ensure that everything goes on paper in writing, from the rate of interest, to the closing costs to the pre-payment penalties and that nothing comes as a surprise after you have signed the contract.

    • Get a Mortgage With Bad Credit

      Date: 2010.03.21 | Category: Mortgage | Response: 0

      In the old days if your credit history was less than perfect, the only mortgage you would be offered would be one with extortionate interest rates from a shady broker.

      Nowadays, there are more sympathetic lenders who will offer you a bad credit mortgage without charging you sky-high interest charges. And because there are more lenders out there now offering these non-standard mortgages, it has driven the interest rates on them down which is good news!

      The term Bad credit can be anything from County Court Judgements (CCJs) on your credit file to something like having missed a mobile phone payment or made a few mortgage payments late.

      More and more people now have a bad credit file. Rising inflation and credit companies making it easier for people to borrow means that just because you have a bad credit file, you are not rubbish with money!

      So, what can you do to get a mortgage, without being ripped off by greedy lenders?

      First of all, if you are considering using a mortgage for debt consolidation, do bear in mind that it will probably cost you more in interest in the long run. And also the debt will be secured against your home, so you must really ensure that it is affordable to you.

      And when it comes to choosing a mortgage, do not apply for the first mortgage that you see. TV adverts saying that they can help people with bad credit are all very well but many of them charge as much as a 3% fee to arrange a sub-prime mortgage. So, on a 150,000 mortgage, they get 4,500!

      Get independent advice from an independent mortgage specialist as well as doing your own research. Bad credit no longer has the financial stigma it used to, so hold out for the right deal for you.

      How the web can help you if you are looking for a bad credit mortgage

      If you have a poor credit history, finding a mortgage specifically for people with bad credit can be difficult. And even if you do find a mortgage, how do you know that it is the right one for you?

      Using the internet can help. There is tons of information on there relating to bad credit mortgages such as free guides, as well as access to providers of bad credit mortgages.

      Going online also allows you to compare multiple providers so that you can look at all the product features and benefits to decide whether it is right for you.

      There are also websites that accept online mortgage applications and there are hundreds that offer free and immediate online quotes. This means that you can see how much you can really afford to pay out for a mortgage.

      Steps to improve your credit rating

      If you have recently applied for credit and have been turned down or you have been offered credit but at higher interest rate than advertised, then this is probably because of your credit rating.

      Even if you never miss payments or do not have any debts such as a loan or credit card, you could still have a low credit rating.

      This is because you can be penalised if your credit record is empty. Prospective creditors like to see positive entries on your credit fie and if you have no financial history, they are unable to judge how well you manage your credit.

      The solution is to develop your credit file by adding positive entries on your record. Running bank and savings accounts as well as paying your mobile phone bills on time are a good start as are well managed credit card and store card accounts.

      If you do not have any credit accounts, then gradually apply for them. Dont apply for lots of credit all one go as this will look like you are in financial distress. Instead, get one card at a time with a low credit limit and pay the balance off in full every month. Open up a bank and savings account. And pay your bills on time even the small ones!

      Start building a financial history gradually and over time you will find it easier to get credit, and at a better interest rate too.