How to buy a house with bad credit? This is a question that more and more people are asking with the recession in full swing. The answer is that you can indeed buy a house with bad credit. However, it's not easy and it's certainly less easy than it was a couple years ago. It used to be that mortgage lenders were practically throwing subprime mortgage offers at everyone. However, with the subprime housing crash, it's no longer easy to get a house if you have poor credit. However, it's not impossible.
The first thing you need to do is look at your credit history. If you have terrible credit history, it's going to be more difficult. You may already have bad credit, but there are levels of bad credit. If your credit is borderline bad, it's possible that the bank might use other factors - your income, your job security, your assets and still give you the mortgage. But with terrible credit, it's going to be an uphill battle.
You should order your credit report from all three major credit agencies and so you know exactly where you stand. Your potential lenders will be looking at these reports and so should you. Go through your credit report with a fine comb to make sure there are no inconsistencies. Credit reporting agencies make mistakes all the time - if you find some errors and challenge them, you may be able to improve your credit score in only a month.
If you have bad credit, you pretty much have only one option - you are going to have to put a large down payment down for your home. The worse your credit, the higher the down payment you are likely going to have to put down. However, with a down payment, you should be able to convince almost any mortgage lender to give you a mortgage.
By:David Jack Thomson