I decided to write this article today after closing a home purchase loan for a couple that had some major credit issues. They got into
house with ZERO down payment, and only had to bring $600 for closing
costs. Their situation was pretty bad, I’m talking about a bankruptcy 2 years ago, thousands of dollars in
outstanding collections, charge-offs and debt to income ratio of 49%. By way, we left all of their
outstanding charge-offs and collections open which means they didn’t have to pay any of them off! So many
think they won't be able to qualify for a mortgage loan. Many will keep thinking they can't qualify until
they read this article.
I have been employed as a Loan Officer for 5 years & I have experience originating conventional mortgage
loans as well as sub-prime (non-conventional) residential mortgage loans. Many of clients that I deal
with have great credit (and know it) and have no problem getting a loan but then there are those with
credit problems (and they know it too). The ones with great credit are ones that are easy to close,
get best rates and all with minimal time involved on part of myself.
But, this article is for those with credit problems, low income and those who cannot afford a down
payment. I am going to show you how to qualify for a loan with ZERO down payment, and only out of
pocket expense will be less than $1,000 ( if any at all) to cover some of closing costs. This is just
an example of one particular loan program that I use but there are numerous others out there. I picked
this loan program because it allows 100% financing down to a 575 credit score
I see it on a daily basis.
Everyone wants to own a home and those with credit problems are calling every mortgage company in
phone book and applying on every mortgage website out there. (And there are many out there). Only to find
out later that every time a mortgage company pulls their credit, their credit score dropped a few points,
or that particular lender doesn’t originate type of loan that you need. That is frustrating.
Step by Step
Here is where I show you how to qualify yourself for a zero down loan.
1.The first thing you need is your tri-merge credit score. I would be more that happy to suggest a few
places on internet that you could go to get your credit score but I don’t want this article to seem
like an advertisement. So, best thing to do is to do a search on yahoo.com for terms like “free credit
reports”, or “tri-merge credit report”. Just make sure that you end up pulling a “tri-merge” credit report
on yourself. A tri-merged credit report pulls your credit profiles from 3 major credit reporting
companies and merges it into 1 report. The nice thing about pulling your credit yourself is that it will
NOT affect your credit score. Bookmark this page while you go get a copy of your credit report and then
come back to see additional steps.
2.What is your credit score? Most mortgage lenders will use middle of three scores. Example: Your
credit scores are 576, 525, 599. In this case you would use 576 credit score since it is not
lowest score and it is not highest.
3.Is your middle credit score at least 575? If so, congratulations and move on to next step. If your
middle score is less than 575 you have some homework to do. You can either sign up with a credit repair
