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I have bad credit but want to buy a home for the first time how do i go about this

  • February 18 2012 - Oroville
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Answers (6)

There are many options for individuals with less than perfect credit. A great option for you would be to talk with a mortgage broker vs. going directly to  a bank. Mortgage Brokers tend to have access to many different investors that might be able to make exceptions as well as be able to lend to individuals. Be sure to ask questions to the mortgage brokers and possibly even get referrals from others. 

If you do intend to repair your credit ensure that you do go with a reputable company as their are a lot of scams out there. 

Warning: Before you go ahead and start repairing your credit talk with a mortgage broker. Sometimes what we assume is "BAD CREDIT" may not be that bad to a lender. Missed payments, late payments that happened a year ago or even longer may not play a that big of a part for a lender as well. A lot of times they will make exceptions as they know life events do happen to individuals. Going and trying to fix these or bring them current also could effect you in a negative way. Although you might have an account in collection that is past history, trying to fix it it or pay if off brings that history current. 


Hope this helps out but please don't get discouraged and remember the best thing is to begin a conversation with someone. At least you will know what path to take to begin to place you on a road to home ownership!

Cheers!
George
  • December 14 2012
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Profile picture for TariPollo
For sure fix your credit first! Many people make the mistake because 10% interest doesn't sound much worse than 7.5%, but this adds up to costing you thousands of extra dollars a year. If I were you I would call [Promotion removed by Zillow moderator. Please see our Good Neighbor Policy.]
  • December 14 2012
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I agree with Dan. I don't know about you personally, user00166, but typically, people have bad credit because they're not good at paying their bills on time and/or they have more debt than they can easily pay off. Also, they tend to want to buy things when they haven't quite finished paying off the other things they bought.

"Repairing" your credit has more to do with correcting false information than it does transforming bad credit into good. And if you have "bad credit," I really think you should rehab that credit, the way you'd rehab a sprained ankle - rebuilding the strength and getting into good habits so that your credit score is easily in the high sixes and then starting to save some money so that you can have a cushion AND get that credit score into the sevens.

All the best,
  • February 18 2012
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Profile picture for the_country_hick
Repair your credit. Build up a good sized down payment. Then see what you can qualify for.
  • February 18 2012
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My first posts on Zillow were asking about this, and if anyone knew of GOOD credit repair companies. I was advised to go to www.myfico.com and learn about repairing my own credit. There is very little anyone can do to fix credit that you can't do yourself. Much of it can be done for the cost of stamps and paper. Our biggest issue was lack of positive trade lines.

Anyway, I did exactly that, I read, I learned, I asked questions, and I took the advise I was given. In less than three months our lowest score has gone up about 100 points. A variety of factors can affect your credit scores and there are a variety of factors that can affect your ability to get a mortgage AT ALL...not just a good mortgage, but a loan at all.

In very short order, I should have several choices on good loans instead of begging someone to loan us money for a house.

  • February 18 2012
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Profile picture for Matt Hiatt
Most Realtors work with people that do credit repair, and that is where I would suggest that you start. Be careful because ther are some shady credit repair places that just want your money. I know that some of my lenders have free credit repair because they want you to use them to obtain your loan when they get it where you can buy a home. I would also suggest that you use this time to save money for down payments and closing costs if you should need.
  • February 18 2012
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