Bad Credit Home Loans Arizona Mortgage Brokers Recommend
If you have bad credit and are in the market for a home, you can qualify for a loan. Here are some bad credit home loans Arizona mortgage brokers recommend you look into and advice on how to qualify.
If you have bad credit, you probably believe that it will be impossible to buy a home. You are not alone in this belief. In fact, many financial experts claim that since 2008 there has been a rumor circulating that you have to have pristine credit in order to qualify for a home loan. While this is categorically false, it has created a bit of a self-fulfilling prophecy in that the rumor is widespread enough to keep sub-prime borrowers from even trying to find home loans for bad credit borrowers. If you are looking for bad credit home loans, Arizona mortgage brokers
can help you find the right loan product to fit your needs.
The most important first step in finding a loan product is to find a mortgage broker that you can trust and who will work for you. When you are looking for your bad credit home loans Arizona
mortgage broker, you need to make sure that your broker has experience with sub-prime borrowers and loans. The more experience your broker has, the more likely he is to be aggressive to secure funding on your behalf. In addition, he will know what you need to have to qualify and will be able to convince a lender to look at your application manually if it fails underwriting due to your credit.
Secondly, make sure that your mortgage broker is honest and up front with you. He should be transparent about any fees you may be charged and should be able to explain why you are being charged them. In addition, your broker should be able to explain the terms of all loans he recommends including monthly payments and any possible fluctuations. He should also be willing to go over all of the numbers with you so you know exactly how much you will be paying each month and what the cost of your credit is in terms of interest and other loan fees.
Types of Arizona Home Loans That Can Help Make Your Dreams Come True
Once you have found a Arizona Mortgage Broker
, you will begin learning about different bad credit home loans Arizona
borrowers can qualify for. One type that you will learn about is a traditional loan. While many people believe that a home loan is out of their reach if they don’t have excellent credit, this is simply untrue. You can qualify for a traditional loan with a credit score as low as 650, far less than perfect. A traditional loan is a 15 or 30 year loan with a fixed interest rate and monthly payment. Your payment will only fluctuate minimally based on property values due to property taxes. Traditional loans require a down payment between 5 and 20 percent depending on the specific loan program, cost of the home you are purchasing, and your credit score.
A second program your broker will recommend is an FHA loan. An FHA loan is a loan secured by the federal government to protect the lender from default. Like a traditional loan, the interest rate is fixed for the loan term which can be anywhere from 15 to 30 years. An FHA loan requires anywhere from 3.5 to 10 percent down depending on your credit score. Your monthly payments with an FHA loan will be slightly higher than a traditional loan because you have to make monthly mortgage insurance premium payments. This insurance helps insure against loan default. Some of the insurance can be paid upfront and you can even negotiate with the seller to pay a part or all of it, depending on your sale terms.
A third program your broker will suggest is an adjustable rate mortgage or ARM. An ARM is a mortgage with a fixed interest rate for 1-7 years. After that point the rate resets to a higher rate and increases your monthly payment. At first, your payments will be low because the initial interest rate is usually lower than prime rates. Once the rate resets your payment will increase. It is important to make sure that you will be able to afford not only the low payment, but also the higher monthly payments once the rate resets. You may also be interested in an ARM if you plan to sell the home before the loan resets. An ARM requires a minimum down payment of 10 percent in Arizona so make sure you have the savings to qualify.
Call a Arizona Mortgage Broker today to learn all of the
benefits of various bad credit home loan programs.
Stop letting bad credit stand in your way and call a broker for advice and to help you purchase the home of your dreams.
NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027