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California Bad Credit Mortgage
By: Carrie Reeder
California is a beautiful place to live There is no doubt about that. But, to
live in California you must pay the price, which is sky high real estate prices.
Renting, as opposed to buying in California, can save a little bit of money.
However, renting has the disadvantage of not building any equity. As home prices
in California continue to rise, you may want to be a homeowner and take
advantage of the home appreciation factor. If you're going to be paying a lot of
money to live in California anyway, you might as well be making some money on
top of it too, right?
Now, if you have bad credit and are trying to get a home loan for California
home prices, this may seem like an impossible situation. Home prices are high
and if you already have poor credit, the fact that you need to be approved for
such a high loan amount can be an added difficulty when trying to get a home
loan.
However, there is hope. There are so many programs available today to help
people with recent bankruptcys, collections and even foreclosures, obtain
mortgage financing. There are nationwide mortgage service companies that can
either approve you directly or get you in touch with a lender who can approve
you.
Here are some suggestions of things you can do to aggressively help yourself get
qualified for a mortgage loan in California, with a bad credit history:
1. Pull your credit and review it - Pulling your own credit will not negatively
affect your credit score like having someone else pull it will. For a list of
the links to the three major credit bureaus, visit this page:
www.abcloanguide.com/credithelp.com. Look over your credit history and make sure
that everything is reporting accurately. Sometimes, something as small as an
account being reported as currently being due as opposed to being included in a
past bankruptcy can be the difference of 10-15 or more added points to your
credit score.
Make sure every account that is closed is reported as being closed. Make sure
that every account that was reported in a bankruptcy is reported that way, and
not being reported as money still owed. If you have small collection accounts,
try to pay them off and then fax confirmation that the account was paid off to
the major credit bureaus so that they can adjust your credit report right away.
Editing this information on your credit report is easier than ever today because
all three major credit bureaus now make it possible to dispute and inaccuracies
online. You could pull all three reports, dispute all inaccuracies and be done
in less than an hour now. Just a few years ago, it used to take hours or days to
fill out all the necessary paperwork.
2. Find a seller who is motivated to pay closing costs or carryback a percentage
of the loan - If you find a seller who is really motivated to work with you,
that may help you get approved with a lender. If the seller can pay your closing
costs, this can free up that money so that you may have a small down payment. If
the seller is willing to carryback a percentage of the loan then the
loan-to-value may be low enough that the lender may consider that as good as a
down payment. If the seller is motivated to work with you, they may be willing
to work through a down payment assistance program to help you make a down
payment. It is illegal for a seller to give you the down payment for their
house, but through down payment assistance programs like Neighborhood Gold and
the Nehemiah program, it is totally legal.
3. Borrow or ask for a gift from relatives toward a down payment - After you
have financed the house, you can usually take out a 2nd or 3rd mortgage up to
the full value of your house, and then you would be able to repay the relatives.
Keep in mind that if you intend the money to be as a loan only from the
relatives, you would need to disclose that to the lender before you close.
Lenders usually have regulations about where the down payment is coming from and
if you are not honest, it could be considered defrauding a lender.
About the Author:
To see a list of recommended mortgage loan companies online who service
California, visit this page: www.abcloanguide.com/mortgageloans.shtml - Carrie
Reeder is the owner of ABC Loan Guide. It is an informational loan website, with
informative articles and the latest finance news. |
