It doesn`t take a great deal of effort to understand how to deal with the bank if you have had a bad credit or if you have filed for bankruptcy and still require a home loan. You must just learn to be a little tactful and you could easily tip the scales in your favor. It is certainly possible to avail a home loan even after filing for bankruptcy. You don`t need a high credit rating to get a mortgage loan, but you will have to work extra hard to prove your credit worthiness to your loan officer or the underwriter at the bank. There are a few simple steps that you should follow in order to secure the home loan, and get an approval from your lender.
Take a good look at your credit report and you are sure to notice a list of errors. Since this report is so vital, it is in your interest to ensure that it is in good shape. Go online to annualcreditreport.com, and get a free copy of your credit report from any of the three credit reporting agencies. If you notice any errors bring it to their notice immediately and get the necessary corrections done before you apply for a home loan.
Making a down payment really helps, and tips the scales in your favor as it is an indication of responsibility on the borrower`s part, while also lowering the risk on the lender. Making a down payment of 10% to 20% of the purchase price of the property, will result in the lender overlooking any bad credit that you might have had in the past.
For those that cannot organize the amount for the down payment quickly, there is something called a personal mortgage insurance or PMI. This will help reduce the lender`s risk while increasing the borrower`s chances of availing a mortgage loan. So shop around, and ensure that you can handle the monthly costs as well as the mortgage payment.
Always be realistic while acquiring a loan and see how much you can pay and what is a reasonable amount. You must ensure that the monthly payments are within reach and buy within your means. There are loan calculators which are available online, so make use of these tools to figure out how much loan you can avail. If you arrive at the right figure getting an approval won`t be difficult.