Owning a home of one’s own is always counted as the fondest dream of all Americans and everyone regardless of their bad or good credit craves for one. Fortunately Americans have the much-needed assistance of the bad credit mortgage lenders who are helping the borrowers with bad credit to fulfill their dreams. The presence of certain programs that are offered by the bad credit mortgage lenders is making it easier for the borrowers to purchase a home even with bad credit. However one must remember that the terms and rates may not appear very favorable and affordable at first sight as the borrowers with bad credit are considered to be risk factors by the lenders. But this is surely an opportunity to re-enter the real estate market and with a little patience one can see the credits getting improved. Bad credit mortgage lenders will enlighten you about the Federal Housing Administration which has become increasingly popular after the subprime meltdown. As the program loosens its requirements, it became easier to obtain a 30 year fixed rate mortgage from it. This makes a borrower even with a credit score as less as 580 eligible for the program. With a score of 580 to 620, you will need 10 percent down. Those with a higher score need only 3 percent down. Borrowers with poor credit but a steady income too can qualify for the program provided by some bad credit mortgage lenders. If you had a bankruptcy or a foreclosure, you need to wait only two to three years to obtain an FHA loan. Another kind of bad credit mortgage lender is a hard money lender who provided monetary assistance to a borrower with any kind of credit score. As a result the borrower must compensate with a lump sum down payment and high interest rate.
Hard money lenders are often used for investment properties and primary residences that will quickly be flipped or sold. If you have bad credit, but you have a lot of cash on hand, this may be an option for you. Some other bad credit mortgage lender will suggest you to get an adjustable-rate mortgage (ARM) or interest-only mortgage with poor credit. This requires you to pay higher interest rate and can also ask for more money down in order to qualify. Remember to make sure that you can repay the mortgage within time limit as refinancing is not possible later, if you credit score is below standard. In other case, apart from bad credit mortgage lender, take help from a local broker who may provide better loans with good terms. They have options for every type of borrower and have access to countless banks and programs. If there is a program for you, a broker would know about it, but a small local bank probably would not. If all these programs and plans fail to apply in your situations, the next best thing will be to try raising your score in few months by paying off debts timely and by applying for new credits and loans.