Thursday, April 15, 2010

How to Get Your First Home Loan with Poor Credit

Buying a home for the first time can be exciting, but if you have poor credit, it can also be a challenge. One of the main factors that a mortgage lender considers when approving or denying an applicant for a loan is credit history. The good news is that if you have poor credit, there are subprime lenders that are willing to loan money to first-time home buyers with poor credit.

Find a subprime lender for a poor-credit loan.

Credit: alaska home image by Silke Wolff from Fotolia.com

Step 1

Find a subprime lender. A subprime lender is a lender that offers loans to those who do not have good credit. These are not your traditional banks and lenders so the fastest and easiest way to find a subprime lender is to contact a mortgage broker or search your local phone for mortgage lenders that specialize in subprime loans.

Step 2

Submit a mortgage application. Once you find a subprime lender, the next step is to apply for the mortgage. Even if you do not have a property chosen yet, you can submit a mortgage application and the subprime lender will approve you or deny you based on your personal financial information.

Step 3

Submit supporting documentation. You'll need to submit copies of your last two year's tax returns, the last two month's paycheck stubs and copies of the last two month's bank and brokerage account statements. These documents along with the information you supply on the mortgage application are used by the lender to qualify you for the mortgage.

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