Subprime Mortgage Lenders - Sub-Prime Loans Now Available Through Traditional Lenders
Below is a MRR and PLR article in category Finance -> subcategory Mortgage.
Subprime Mortgage Lenders: Now Available Through Traditional Lenders
Overview
Subprime loans are increasingly accessible through traditional lenders, even if you have a bankruptcy or foreclosure in your credit history. The secret to securing a favorable subprime mortgage is thorough research and careful comparison of terms and rates.
Understanding Your Credit History
Having a poor credit history doesn't automatically mean you need to turn to subprime lenders. It's possible you might still qualify for an A loan, typically for individuals with good credit. If your bankruptcy was over four years ago and you've maintained a solid payment record since then, your FICO score might exceed 600, making you eligible for an A loan.
Programs like FHA loans allow you to apply just two years after a bankruptcy or foreclosure. VA loans also tend to be more forgiving regarding past credit issues. Don’t assume that a challenging credit history confines you to higher-interest subprime loans.
Exploring Subprime Mortgages
Should your credit be less than ideal, traditional lenders might still offer competitive interest rates. As financial institutions broaden their options, many now include B, C, and D loans in their offerings.
Subprime mortgages are influenced by your credit history but place significant emphasis on your mortgage or rent payment history. Providing proof of timely rent payments, via rent receipts or checks, is crucial. Mortgage payments can be tracked through your credit report.
Remember, subprime mortgages are generally short-term solutions. Once your credit improves, you can refinance for better rates.
Searching for Subprime Lenders
When seeking a subprime lender, consider all options. Request quotes from both traditional lenders and those specializing in poor credit financing. Compare various financing packages to find the best rates and terms.
Ideally, look for a loan with a low APR and no prepayment penalties. If you don't plan to hold your mortgage for seven or more years, paying points for lower rates might not be beneficial. Additionally, an ARM could offer lower rates and greater purchasing power than a fixed-rate mortgage.
You can find the original non-AI version of this article here: Subprime Mortgage Lenders - Sub-Prime Loans Now Available Through Traditional Lenders.
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