How To Buy A Home When You Have No Credit?
Posted on: 29 December 2018
When you buy a house, one of the first things banks and lenders look at is your credit. If you have no credit due to a bankruptcy, your age, or other factors, your chances of getting into a new home may appear to be slim.
However, there are many ways you can buy a house when you have little to no credit. Here are methods you can use to buy a home where credit is a concern.
Pick the right lender
Choose a lender that offers no credit financing to help you get into your new home. These lenders such as SWE Homes have connections to banks and financial programs to help people like you who don't have much credit to their name and will make it easier for you to get approved for home financing. When you sit down with a lender, you will learn the maximum dollar amount of a home you can afford, what your potential interest rates will be, and other factors that go into a home loan.
Have a down payment
When you buy a home, you need a down payment in most cases. The down payment amount varies depending on the price of the home and what your credit history is like. If you have a sizable amount of money set aside for a down payment on a house, you can be more likely to be approved for a home loan that has lower interest rates or better lending terms.
Have a co-signer
Do you have a parent, sibling, or other person who will be willing to be a co-signer for your home loan? A co-signer is a person who has good credit who uses their financial backing to help support your loan. You are the main person on the home loan, but the co-signer is held equally responsible for paying back the loan should the loan default for any reason. Having a co-signer is like having strong collateral and can help you get into a more expensive home or get approved for your first home.
There are many ways you can get a home when your credit is not great. Having no credit will change once you get into your home, as home ownership usually shows up on a credit report when you make monthly payments to your lender. Pay attention to the different ways you can get into a home so you choose the best financial solution for your needs.
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