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Advice on getting a loan with poor credit

Mark Cappel
UpdatedOct 12, 2007

Is it possible to get a loan with such poor credit? Please help I need some good advice asap.

I have poor credit because of disability and low income. I am taking care of a disabled mother and husband. I would like to get a home in KY where my sister is, so that she can help with my mother and maybe I can better my situation. We own a moble home and lot in In which we hope to sell and pay off our creditors but we need to get a home in Ky first. Is it possible to get a loan with such poor credit? Please help I need some good advice asap.

If your credit score is really as bad as you seem to think, you may have a difficult time finding a lender willing finance your mortgage. While I do not think it is impossible for you to find a loan, I expect that you have a lot of work ahead of you, and you should expect to pay a premium in interest and costs for any loan you are able to obtain. Six months ago, I would have been much more optimistic about your prospects for finding a loan, but the sub-prime mortgage market, which offers loans to individuals with credit problems, has taken a nosedive in recent months, making it much harder for borrowers with less than perfect credit to find a loan.

I do not want to sound totally discouraging, though. Your ability to qualify for a mortgage loan will depend on several factors aside from your credit score, including your income, your performance on other secured accounts, and the amount of money you have available for a down payment. If you have a good income and a sizeable down payment, you may be able to find a decent loan despite your credit problems. I encourage you to visit the Bills.com Home Purchase page at http://www.bills.com/homepurchase/ for more information about purchase loans and links to find lenders that may be able to help you find a loan.

If you cannot find a loan that suits your needs, you may want to continue working on your credit score. The more you can increase your credit score, the better loan terms you will be able to obtain. You may want to consider renting for a while, rather than purchasing a home immediately when you move to Kentucky. Take your time to work on your credit and to make sure you are in the best financial position possible before buying a home. The Bills.com Credit Resources page, at http://www.bills.com/credit/ offers a wealth of information about credit scoring and advice on improving your credit rating.

The most important piece of advice I can offer is to make sure you do not borrow more than you can realistically afford to repay. The number of repossessions has skyrocketed in recent months due to consumers? inability to keep up with their adjustable interest rates, so make sure that you do not fall into that trap. The risk of running into this problem has decreased significantly in the past few months due to the crisis in the sub-prime mortgage market, but you should still be careful in examining all of the terms of a loan before you agree to it.

Good luck. I hope this advice helps you Find. Learn. Save.

Best,

Bill

www.Bills.com

2 Comments

PPark, Dec, 2007
Any student who is considering financing their education should exhaust their federal student loan options first. Federal student loans are not based on credit and come at lower interest rates than private student loans, which are credit based. Also, federal student loans do not require payback while the student is enrolled in school. Federal student loans do have maximum limits allowed depending on the year the student is in school. Your school will also need to be an accredited title IV school to qualify for the loans. It would be best to contact the financial aid office for your school and ask about federal student loan eligibility.
DDavid L Grassie, Dec, 2007
I am in the process of better my life by going back to school. I have found three Vocational/tech. schools. The problem I am having is finanacing the school, and having enough money to live on on, and keep my bills up. While i am in this schhol for a couple of months. Due to poor credit can and would you be willing to help. Thank you in advance