It is important for every consumer to keep on top of his or her credit report and credit score. The information contained in your credit report is of vital importance to your financial well being, and it will determine the FHA mortgage rates you get on your FHA mortgage loan, as well as the interest rates and terms on a number of other loan products.
There is no doubt that having bad information in that credit report will greatly impact your ability to qualify for the mortgage you need, and furthermore it will greatly influence things like how large a down payment you will be required to make and how high an interest rate you will be charged. When you look at those ads for super low FHA mortgage rates, it is important to remember that those interest rates are typically reserved for those with the best credit histories and the highest credit scores.
All is not lost, however, if you have a couple of missed payments or even a bankruptcy in your past. While such negative events certainly complicate the mortgage application and approval process, people with bad credit can, and do, get mortgage loans every day. The key is to make yourself a knowledgeable consumer, and to do plenty of shopping around. Thank goodness there are sites that offer FHA loan guidelines and allow you to have FHA lenders competing for your business.
Shopping around is even more important when you have negative events in your credit history. There is no doubt that a bad credit history complicates the loan process, and this makes shopping around much more important than for those with perfect credit.
That is because not all bad credit mortgage lenders are the same. While one potential mortgage lender may require a 30% down payment and a very high interest rate, the next bad credit mortgage lender may be able to offer more favorable down payment terms and interest rates. If you do not shop around you may never know just what types of mortgage loans are available for those with less than perfect credit.