Bad Credit Home Loans Arizona Mortgage Brokers Recommend

If you have bad credit and are in the market for a home, you can qualify for a loan. Here are some bad credit home loans Arizona mortgage brokers recommend you look into and advice on how to qualify.

If you have bad credit, you probably believe that it will be impossible to buy a home. You are not alone in this belief. In fact, many financial experts claim that since 2008 there has been a rumor circulating that you have to have pristine credit in order to qualify for a home loan. While this is categorically false, it has created a bit of a self-fulfilling prophecy in that the rumor is widespread enough to keep sub-prime borrowers from even trying to find home loans for bad credit borrowers. If you are looking for bad credit home loans, Arizona mortgage brokers can help you find the right loan product to fit your needs.

The most important first step in finding a loan product is to find a mortgage broker that you can trust and who will work for you. When you are looking for your bad credit home loans Arizona mortgage broker, you need to make sure that your broker has experience with sub-prime borrowers and loans. The more experience your broker has, the more likely he is to be aggressive to secure funding on your behalf. In addition, he will know what you need to have to qualify and will be able to convince a lender to look at your application manually if it fails underwriting due to your credit.

Secondly, make sure that your mortgage broker is honest and up front with you. He should be transparent about any fees you may be charged and should be able to explain why you are being charged them. In addition, your broker should be able to explain the terms of all loans he recommends including monthly payments and any possible fluctuations. He should also be willing to go over all of the numbers with you so you know exactly how much you will be paying each month and what the cost of your credit is in terms of interest and other loan fees.

Types of  Arizona Home Loans That Can Help Make Your Dreams Come True

Once you have found a Arizona Mortgage Broker, you will begin learning about different bad credit home loans Arizona borrowers can qualify for. One type that you will learn about is a traditional loan. While many people believe that a home loan is out of their reach if they don’t have excellent credit, this is simply untrue. You can qualify for a traditional loan with a credit score as low as 650, far less than perfect. A traditional loan is a 15 or 30 year loan with a fixed interest rate and monthly payment. Your payment will only fluctuate minimally based on property values due to property taxes. Traditional loans require a down payment between 5 and 20 percent depending on the specific loan program, cost of the home you are purchasing, and your credit score.

A second program your broker will recommend is an FHA loan. An FHA loan is a loan secured by the federal government to protect the lender from default. Like a traditional loan, the interest rate is fixed for the loan term which can be anywhere from 15 to 30 years. An FHA loan requires anywhere from 3.5 to 10 percent down depending on your credit score. Your monthly payments with an FHA loan will be slightly higher than a traditional loan because you have to make monthly mortgage insurance premium payments. This insurance helps insure against loan default. Some of the insurance can be paid upfront and you can even negotiate with the seller to pay a part or all of it, depending on your sale terms.

A third program your broker will suggest is an adjustable rate mortgage or ARM. An ARM is a mortgage with a fixed interest rate for 1-7 years. After that point the rate resets to a higher rate and increases your monthly payment. At first, your payments will be low because the initial interest rate is usually lower than prime rates. Once the rate resets your payment will increase. It is important to make sure that you will be able to afford not only the low payment, but also the higher monthly payments once the rate resets. You may also be interested in an ARM if you plan to sell the home before the loan resets. An ARM requires a minimum down payment of 10 percent in Arizona so make sure you have the savings to qualify.

Call a Arizona Mortgage Broker today to learn all of the 

benefits of various bad credit home loan programs.

Stop letting bad credit stand in your way and call a broker for advice and to help you purchase the home of your dreams. 

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Arizona Home Loans: Choosing the Right Loan Product

Arizona home loans are in high demand as interest rates are dropping and housing inventory is increasing. A mortgage broker can help you choose the best loan for your financial situation and make your homeownership dreams come true.

The real estate market in Arizona is booming. With gorgeous spring temperatures, and plenty of ways to beat the summer heat, it is easy to see why. Arizona has a lot to offer to individuals and families. Whether you are moving to the Grand Canyon State for work, the weather, or for all the family friendly activities and destinations, there is something in Arizona for everyone.

If you have bad credit, you may think that a move into or around Arizona is impossible. You may think that Arizona home loans for bad credit don’t exist. This has been a widespread and false rumor since the housing crisis of 2008. Many people believe that it is impossible to get a home loan without perfect credit. In a way, this has become a self-fulfilling prophesy because many individuals and families with bad credit won’t even apply for a loan for fear they will just be turned down by the bank. However, there are many programs in Arizona that can help sub-prime borrowers meet eligibility requirements for home loans.

Types of Arizona Home Loans

The most common type of Arizona home loans is a traditional mortgage. Most people with bad credit automatically assume they cannot qualify for this type of loan. While a traditional mortgage does have the most stringent credit requirements, they are not as high as many people believe. If you have a score of at least 650 you have a chance to qualify for a traditional loan. A traditional loan is a fixed 15 to 30 year loan with payments that will remain roughly the same for the entire loan term. Payments may fluctuate slightly based on property tax amounts but they principal and interest will remain the same. In order to qualify for a traditional loan you will need to put between 5 and 20 percent of the loan amount down.

If your credit score is less than 650, you can still find Arizona home loan that you can qualify for. One of the main types of loans that can help sub-prime borrowers is an FHA loan. An FHA loan is a loan that is secured by the federal government. You will pay a fixed rate for principal and interest for a 15 to 30 year loan term. You will also pay mortgage insurance in the amount of 80 to 200 dollars each month, depending on the amount of your loan. You can qualify for an FHA loan with a credit score as low as 500 as long as you have between 3.5 and 10 percent of the loan value to put down.

If you find that you cannot qualify for a traditional loan or an FHA loan, there are some less common programs that may be able to help you buy a home in Arizona. One is a rent to own program. When you rent to own, you pay rent that for the first 18-24 months goes towards making a down payment on the home. Your rent payments will be higher than if you were just renting the home but you will be making progress towards owning it. Another way to purchase a home with bad credit is with seller financing. This is most common if the seller owns the home outright or owes a very small amount left on the mortgage. The seller carries the debt for you and you make monthly payments, including interest to the seller. Often you will need to put a large chunk down so that they seller is assured that you have a vested interest in paying the loan in full by the agreed upon time period. Finally, you may also want to have a family member with higher credit cosign for you. This will help you get a loan and be on track to rebuilding your credit. However, be aware that any late payments will also affect the credit of your cosigner.

Regardless of which loan product you choose, an Arizona mortgage broker can help you reap the benefits of Arizona home loans.

An aggressive broker is key when securing a home loan with bad credit. A licensed broker can negotiate with various lenders to help get them to see you as more than a credit score. In fact, many people who have gotten home loans with bad credit claim that they owe their success to a broker who was working for them. Call a broker today to start the process of owning your own home. You will be glad you did. 

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027