If you have bad credit, you may think it’s impossible to be approved to buy a second home. Surprisingly, this isn’t the case. You may have to be a bit more creative, but it certainly is doable.
Pittsfield, MA -- (SBWIRE) -- 08/28/2013 -- Real-Estate-Yogi.com has tips to help you squeeze out of a bad credit situation and into a new home.
- Just How Bad Is Your Credit?
- What Are Your Options?
How Bad Is It?
Typically, a bad credit score is 620 or below. If you’re below that number the bank may or may not approve you for a loan. If they do, you can expect to pay at least 20% down right off the bat. Your interest rate will likely also be higher. If the bank turns you away, there are plenty of other ways for buying that second home.
Buying A Second Home With No Money Down And Bad Credit At Affordable Monthly Installments!
Other Options
If you’re wondering how to buy a second home with bad credit, you have other options than obtaining a traditional mortgage through a bank.
Real-Estate-Yogi.com offers program, that lets people buy their foreclosed homes. Particularly, it’s for people with bad credit. In fact, you can buy a second home with a credit score of just 580. But there is a catch: buyers must put a whopping 20% down and can expect for a higher interest rate than someone with good credit.
If you aren’t interested in a foreclosed home, you could go to a hard money lender (or a private lender). But the pricing is steep: most lenders expect 35% down, and may charge interest as high as 14%. However, you have a better chance getting the loan from a private lender than you do from a bank if your credit isn’t up to par. The extra costs simply protect the lender’s investment and money.
The most inventive way buying a second home with bad credit is to enter into a lease option. If you lease a home with the option to buy, you also buy yourself time. You have the second house to live in, and you can start work on getting your credit in order so that you can later buy the home. This arrangement will really work in your favor. Lease options secure the value of the home the day you lease it, so its price will not change a few years later if you decide to buy it. Your lease payments can also be credited towards the total mortgage, so that you don’t start a fresh mortgage once you buy.
About Real-Estate-Yogi.com
But www.real-estate-yogi.com located in Pittsfield, Massachusetts can help you find ways to make your credit work for you as Bad credit can make large financial arrangements difficult, especially if its buying a second home. In addition to our online database, which connects you to experts in the real estate field, you can also reach us 24/7 by phone at 1-800-987-1397. Our associates are standing by to take your questions, or help you schedule a free consultation.