Low Credit Score Mortgage Loans How To Get A Better Loan Rate

Low Credit Score Mortgage Loans How To Get A Better Loan Rate

Low Credit Score Mortgage Loans - How to​ Get a​ Better Loan Rate
Loan rates depend on​ many factors outside of​ market rates .​
Your credit score,​ the​ property’s value,​ and company policies all affect what you​ will pay for your mortgage .​
With so many variables,​ you​ can get a​ better loan rate with some careful research.
Revaluate Your Credit Profile
There are many factors that influence your credit score besides payment history .​
Income,​ assets,​ and debt to​ income ratio are important to​ lenders .​
So even with a​ recent foreclosure,​ a​ high level of​ cash assets could qualify you​ for a​ decent rate.
Lending companies don’t automatically use the​ FICO score to​ rank your loan application .​
The financing company may use there own standards or​ allow loan officers to​ make decisions .​
This is​ where a​ letter in​ your credit report explaining extenuating circumstances,​ such as​ a​ job loss or​ illness,​ can help .​
Just be prepared to​ verify the​ information if​ the​ lender asks.
Take a​ Close Look At Your Property
Your property’s value can also affect your rates .​
a​ property in​ an​ area with a​ proven history of​ increasing home values is​ easier to​ qualify for low rates.
Conventional loans,​ those sponsored by government entities such as​ Fannie Mae,​ have lower rates with their loan caps .​
Larger loans,​ also known as​ jumbo loans,​ will have higher rates.
Improve Your Down Payment
A large down payment can also improve your rates .​
20% is​ a​ good starting figure,​ but more is​ better .​
Right after a​ bankruptcy,​ you​ may have to​ put up as​ much as​ 50% to​ secure a​ loan.
Select Adjustable Rates
Adjustable rate mortgages also offer low rates,​ at​ least initially .​
Usually you​ will have one to​ seven years with a​ low fixed rate .​
This low payment will help you​ to​ qualify to​ borrow more.
However,​ after your initial period,​ mortgage rates will rise and fall based on​ a​ specified market index .​
Caps will offer you​ some protection from drastic increases in​ payments .​
You may also have the​ option to​ refinance to​ lock in​ low rates.
Take the​ time to​ read about rates and terms .​
Ask for lots of​ quotes and play with changes in​ terms to​ improve your rates.

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