When applying for a mortgage loan, your credit score plays a huge role. Thus, many people choose to establish a good credit history before applying for a mortgage. Having a low credit score will not necessarily prevent you from getting a mortgage. Likewise, it's possible to get a mortgage with no credit history. Before applying for a no FICO score home loan, it is important to understand how these loans work, and how to qualify.
Purpose of You Credit Score
Credit reports are very important. How would a bank lender be able to assess who they can and can't trust with a loan if there was know way to estimate how they were going to handle your money. That is why we have credit reports. Trust me, not having credit reports would be worse for everyone. Credit reports have quite a bit of information. They include your history of payment and your credit history--two different things. A history of payments is self explanatory but a credit history is comprised of the number of credit lines you have, the length of time those lines have been open, and the outstanding balance on the accounts.
How Mortgage Loan is Affected By Credit Scores
A long time ago, getting a mortgage loan with poor credit was impossible. But, now lenders and other institutions have started to offer flexible programs that make you able to qualify yourself and your family for the loan. These mortgage loans are designed especially for those families and individuals with poor credit.
Bad credit generally consists of several late payments, bankruptcies, foreclosures, collections, judgments, etc. All of these factors contribute to very low credit scores. Low credit scores equal higher interest rates, which will increase mortgage payments. Fortunately, there are loan programs in which FICO scores are not a primary factor.
What are No Credit Score Home Loans?
If you have little or no credit, you might qualify for this type of a home loan. I most cases, home buyers earn quite a large income so that they can afford a home. But, in some instances, due to past credit history, even if you make enough to purchase a home now, a bank may not qualify you for the loan but will rather ask that you wait for the credit to return to the amount where they can approve you.
ABC Loan Guide
There are quite a few banks and mortgage officers now that offer the no-FICO loan, but that doesn't mean you don't need anything. You have to first pass their other qualifying criteria. So you are aware, most banks will only finance up to 80% of the total loan, sometimes less. Also, the loan will always require full documentation if they are not requiring you FICO score. That's is a fair trade-off if you ask me. What that means is that you must provide income documentation to the lender.
Purpose of You Credit Score
Credit reports are very important. How would a bank lender be able to assess who they can and can't trust with a loan if there was know way to estimate how they were going to handle your money. That is why we have credit reports. Trust me, not having credit reports would be worse for everyone. Credit reports have quite a bit of information. They include your history of payment and your credit history--two different things. A history of payments is self explanatory but a credit history is comprised of the number of credit lines you have, the length of time those lines have been open, and the outstanding balance on the accounts.
How Mortgage Loan is Affected By Credit Scores
A long time ago, getting a mortgage loan with poor credit was impossible. But, now lenders and other institutions have started to offer flexible programs that make you able to qualify yourself and your family for the loan. These mortgage loans are designed especially for those families and individuals with poor credit.
Bad credit generally consists of several late payments, bankruptcies, foreclosures, collections, judgments, etc. All of these factors contribute to very low credit scores. Low credit scores equal higher interest rates, which will increase mortgage payments. Fortunately, there are loan programs in which FICO scores are not a primary factor.
What are No Credit Score Home Loans?
If you have little or no credit, you might qualify for this type of a home loan. I most cases, home buyers earn quite a large income so that they can afford a home. But, in some instances, due to past credit history, even if you make enough to purchase a home now, a bank may not qualify you for the loan but will rather ask that you wait for the credit to return to the amount where they can approve you.
ABC Loan Guide
There are quite a few banks and mortgage officers now that offer the no-FICO loan, but that doesn't mean you don't need anything. You have to first pass their other qualifying criteria. So you are aware, most banks will only finance up to 80% of the total loan, sometimes less. Also, the loan will always require full documentation if they are not requiring you FICO score. That's is a fair trade-off if you ask me. What that means is that you must provide income documentation to the lender.
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