Bad Credit Mortgage Lender

Could a lender help you get a loan?

A credit rating is of two kinds. It can either be a good credit or a bad credit rating. A person who pays his credit in time is classified as having a good credit whereas an inidividual who misses to pay his credit has a bad credit rating as shown by his credit report.

There are several causes of having a bad credit. We here stories of a lot of people that because of the current economy, people are losng their jobs so therefore they are unable to pay their credit bills. Others are unable to pay due to medical reasons and large medical bills. As a result certain individuals filed for bankruptcy.

A bankruptcy report stays in the person's credit report for approximately seven years. This lower' s once credit rating. If this person wants to get a loan from a bank or mortgage company, he may have a hard time getting one. The lender after looking at the person's report will conclude that he could not trust this individual. That he, the borrower, will not be able to pay the loan if he, the lender, lend him  the money based on his credit report.

Now if you are one of those whose credit rating is bad and you need a loan for whatever reason, you might be eligible for what we call bad credit loans offered by a lender. It's a type of loan for those who are not qualified for a regular loan.

Bad credit loan types according to purpose offered by lender:

-Car loans
-Mortgages- known as bad credit mortgage loan
-Debt consolidation or quick cash loans

If you want to take a bad credit mortgage loan bear in mind the following that bad credit mortgage lender will:

-Scrutinize your income. Lender mostly require that payment towards debt should not be greater than 21% of income.
-The lender will ask you a down payment around 7 to 10%
-The lender will give you a higher interest rate. If the interest is lower, the closing cost charge is usually higher.
-The lender will offer you terms that are very rigid
-Your monthly payments are higher
-You need to buy PMI or Private mortgage Insurance which you pay monthly.
-Total loan cost are higher
-Your home is your collateral and if your are unable to make a timely payment the lender can take your house.

So when the lender give you the agreement with the terms and payment of your loan, read and check if there's any prepayment penalties if you pay your loan earlier than the agreed lenght of the loan.