Wednesday, March 21, 2007

Bad Credit? Financing a Home is Tougher

There has been a shakedown in the subprime financing market as lenders realize more defaults on loans are occurring. Subprime borrowers accounted for 15% of the mortgage borrowers and have credits scores of less than 620 (score ranges are 300-850). Overnight lenders have tighten guidelines and many have went out of business. Guidelines have tightened for borrowers who want to refinance with less than 10 equity in a home, want a loan without verification income or assets, or want to borrow more than 95% of home values. Lenders want higher standards as higher credit score by 20-40 points, larger down payment, lower maximum loan amounts. So, even if you have bad credit, there are lenders that will provide financing, but it may take some preparation on behalf of the borrower to meet the higher standards. Please see article for complete details. http://www.orlandosentinel.com/classified/realestate/orl-mortgage31807mar18,0,7503547.story?track=mostemailedlink