Mortgage with Bad Credit

Does your credit score make homeownership seem out of reach? Even with marginal credit, you can still access the home loan you need.

With the right guidance, you can improve your credit score to qualify for a home loan.

A bad credit mortgage may seem impossible. But with the right steps and loan selection, you too can own a home.

At Homesite Mortgage, we understand that financial mistakes of the past don’t necessarily reflect where your financial status of the present stands. That’s why we’re willing to work with borrowers of all financial backgrounds to help them qualify for a loan that allows them to reach their dreams of homeownership.

If a credit score is weighing down your homeownership options, don’t lose hope. With the a knowledgeable lender and a solid understanding the options and programs you are able to take advantage of, you can still qualify for the home loan to purchase the home your family needs. Choose to work with Homesite Mortgage—we have relationships with credit repair services that will put you in the best position to qualify for a home loan.

What is a Credit Score and How Does it Affect Qualifying for a Home Loan?

Your credit score is a figure between 300–850 that represents your creditworthiness as a consumer. A high credit score reflects a borrower’s history of repaying debts. Below are the credit score ranges:

  • Excellent: 740+
  • Good: 661–739
  • Fair: 601–660
  • Poor: 501–600
  • Bad: 500 and less

You Can Improve Your Credit Score

Rebuilding your credit score to a higher level is completely possible with the right guidance. From paying your bills on time, to double checking your credit report for errors, and utilizing existing accounts (instead of opening new credit cards), you can work toward qualifying for the home loan your family needs.

Mortgage Programs Exist for a Bad Credit Mortgage

If you’re wondering what factors go into calculating your mortgage score, it’s helpful to know the parameters that affect your credit score. Data such as late payments, non payments, current debt, types of credit accounts being used, amount of credit scores pulled, history of bad credit (writing bad checks), and your history of applying for credit will all affect your credit score. Be aware of those factors when taking strides toward improving your credit score (and verifying that there aren’t any errors in your current report).

Bad Credit Mortgage FAQs

How can I reduce my debt to income ratio?

In order to qualify for a loan with a low credit score, adjusting your debt-to-income ratio is a great start. You want to have a significantly higher income than what you owe in debt. Start by paying down debt that comes with high interest payments—credit card debt, for example. If that’s not a feasible option at the moment, look into transferring your credit card debt into a personal installment loan, which can be taken out through your bank. You’ll be able to deal with your debt in one location and the interest rate will be significantly lower than the interest charged by your credit card company.

Will a higher down payment lower my loan’s interest rate?

If you are struggling to qualify for a loan due to a low credit score, having a large down payment to offer will make a big difference. It offers your lender assurance that a large portion of the loan is already going to be paid back. Having a larger amount of equity in the home you want to buy will make it easier for a lender to qualify you for the loan that you need. Additionally, with a higher down payment, you may not have to pay for PMI (private mortgage insurance), which will also save you money.

Are ARMs a good option for someone with lower credit?

ARMs can be appealing options for borrowers with low credit scores. When a borrower has a low credit score, the interest rate on a fixed-rate loan is going to be higher than usual. In situations like those, ARMs can be a better option due to their lower interest rates than what’s available through a fixed-rate mortgage. Speak with your lender to get an idea of what your options are and what will likely save you the most money.

What can I do to access a lower interest rate?

If you’re not able to qualify for a loan with an affordable interest rate (in spite of efforts to improve your credit score), we have a couple suggestions that can help your situation. First, consider depositing a large sum of money in the bank, or prove to your lender that you have other liquid assets available. This will show your lender that you have the ability to make payments on the loan. Second, think about asking another family member or close friend with good credit to co-sign the loan. This gives the lender confidence that they’ll be repaid for the loan amount since another person with good credit is agreeing to repay the loan if you default on it.


Make an appointment with a mortgage expert.

Have questions? Want to learn more? Schedule an appointment for one of our banker to call you.

Why choose Homesite Mortgage for your refinance?

Our licensed mortgage bankers are trained to offer intelligent mortgage advice!

Our interest rates and closing costs are low so that you’ll save more money!

We may be able to waive the need for a home appraisal!

Our state-of-the-art technology is designed to save you time and keep your personal information safe!

Our mortgage process is quick and easy – you’ll typically close your loan in just 18-20 business days!

Our company culture is truly consumer-focused and we guarantee your mortgage experience will be better than any other!