Is Going For Bad Credit Home Loan In Michigan a Good Idea?
October 18, 2011
Author: Allison K.Watkins
Bad credit home loans in Michigan are specifically offered to those who have had financial problems like credit scores below 700, have filed for bankruptcy in the past 2 years or are heading towards foreclosure. You can get your credit score by requesting for a copy from any of the major credit bureaus. You should look at strategies to improve your credit score and in turn get better interest rates and better terms on your loans.
Ways of getting Bad Credit Home Loans in Michigan
Some bad credit home loan lenders in Michigan offer loans at very high rates; you should conduct a thorough market research and look for lenders who offer loans at lower interest rates. You should search for those lenders who offer multiple quotes. Though your credit score might be poor, there is no need to pay high interest rates as this will lead to greater financial problems.
Once you have decided on purchasing your own home in spite of your bad credit, you should collect some initial information by searching for details through the numerous banks/financial web sites for a home loan debt rate quote. You can also find out the appraised value of the home.
If you do some research and comparison of quotes of various lenders, you can find bad credit home loans in Michigan with low interest rates. Bad credit home loans in Michigan have introductory interest rates that are fixed for 2-3 years. However, these rates are higher than the interest rates charged for a 30-year fixed rate loan. You will have to pay higher interest rates if you have a bad credit as the lenders feel that you have more chances of defaulting as compared to those who have a good credit score.
Lenders for Bad Credit Home Loans in Michigan
Lenders who specialize in bad credit loans in Michigan are known as sub-prime lenders. Borrowing from sub-prime lenders should be considered as a temporary solution to cater to your requirement of rebuilding and reestablishing your credit score. These lenders charge you more fee as compared to the fee charged by lenders offering regular home loans. This fee can range from 1-6% of the loan amount.
Though the fee is higher, there are many benefits with a bad credit home loan in Michigan like:
- Consolidation of bills into a single bill
- No need to worry about the creditors
- Opportunity to improve your credit score
- Opportunity to avoid bankruptcy
- Ability to make home improvements or renovations
Therefore, shop around for a mortgage lender in Michigan who can offer you a bad credit home loan of your choice. There are many lenders in Michigan who specialize in bad credit home loans.
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