GET A MORTGAGE WITH NOT SO PERFECT CREDIT

Some people believe that if they have had credit problems in the past, they will not be able to qualify for a mortgage. Some people believe that if they have had credit problems in the past, they have no choice but to get a high interest rate mortgage in order to buy a home. While there is some truth to both statements, there are also many misconceptions lumped into them.

 

Mortgages can be categorized into a couple of categories. There are the A Paper lenders and the B through E Paper lenders (commonly called B/C for short.) A Paper lenders or mainstream lenders make loans to the good credit borrowers. B/C Paper lenders or subprime lenders make loans to the rest of the population. A mainstream mortgage is considered the lowest risk mortgage, while a subprime mortgage is a higher risk mortgage. Mainstream mortgages have the lowest interest rates, while Subprime mortgages have the higher interest rates.

There are many issues with a person’s credit history that can be tolerated by mainstream mortgage lenders. However, there are credit issues that won’t fit with mainstream lenders and when this is the case, the options for the consumer become slimmer. However, before you decide not to pursue a mortgage or before you decide to pursue a high interest rate mortgage, get the facts.

KNOW WHAT’S ON YOUR CREDIT REPORT
The first thing you should do is get yourself a copy of your credit report. There are three different credit reporting bureaus and they can all have different information. Therefore, it’s in your best interest to get a copy of each of them. You can request a copy from each bureau through the mail or there are many different web sites that you can visit and download your report. There is normally a fee with all of these options.

Equifax 1-800-685-1111
Cost: $8.00
** One copy is FREE if you have been denied credit, employment or benefits due to your credit and can be requested over the phone.**

Experian 1-800-682-7654
Cost: $8.00
** One FREE copy per year (can be requested over the phone)**

Trans Union Corp. 1-800-888-4213
Cost: $8.00
** One copy is FREE if you have been denied credit, employment or benefits due to your credit and can be requested over the phone.**

All of the credit report links in my LINKS section provide the service of credit reports on-line. Also many of the rate shopping sections provide this service (pretty much through the same links I’ve provided.)

CREDIT PROBLEMS AND THEIR AFFECTS ON MY MORTGAGE APPLICATION

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