If you need to purchase a new home the first thing a lender will look at is your credit history. If the company sees that you have no credit history at all, they may be not as willing to offer you a loan. This is because they do not know if you will pay your monthly payments on time each month. Fortunately, there are ways you can get the home you need, three of which are listed below.
Find a Lender
If you take your time and look hard you can find a lender that will work with someone that has no credit. First, talk with your local bank. A local bank may have less loan requirements when compared to a larger bank. Also, if there is a credit union near you, they may be more willing to give you a chance.
If you have been the customer of a bank for a long time, you will have a better chance of securing a mortgage for them. This is especially true if you have kept your accounts at the bank in good standing.
Look online for lenders that are willing to work with someone that has no credit history. You will find many lenders that will do this. Before you do anything, check the reputation of the online lender. You may be able to find the best loan in this way, however.
Purchase a Lease to Own Home
Another option you have is to purchase a lease to own home. With this, you pay a set rent payment due each month. The main difference, however, is part of the rent that you pay is put towards the down payment of the home. When you get to the end of your rental agreement, your landlord will sell you the house.
This is a good situation as this is a way to build your credit as you will be making monthly rent payments. This will also allow you to get a mortgage in the future with a good interest rate if you decide to buy a house again in the future.
Build Your Credit
If you do not need the home immediately, you should take time to build credit. In order to do this, open a credit card. Many credit card companies will approve a credit card for someone that has no credit. You could also open a store charge account, if you prefer. You could also open a cell phone account.
Anything that requires you to make a monthly payment on a regular basis will help you. Lenders would like to see reliable payments for approximately one year. This shows them that you will be reliable in making your payments each month.
Following these tips should help you get into a new home quicker. Contact a company, like SWE Homes, for more help.