Can I buy a home if I have under 500 Credit Score?

Question

Can I buy a home if I have under 500 Credit Score?

Answer 1

Look for a mortgage lender that does manual underwriting.  It's how they use to do loans before credit scores.  

Answer 2

That seems a bit low, but there are other factors. For instance, if you have a low debt-to income ratio, and can pay a larger down payment it may be possible, depending on how much you need to borrow, where the home is, and how stable your employment record is. However, you may end up stuck with high interest rates, or terms that are otherwise a problem. It would be better to visit your bank's credit advisor, and discuss a plan to bring your rating up. The lower your rating, the worse deal you get. It would probably work out better in the long run if you do that before considering the purchase of a home.

Answer 3

There is always a way. Credit won't even come into play in some cases:

-- if you have enough cash to buy a home outright (either you'll have to have lots of money or you'll have to find a very low-cost house, which usually means a bad house in a bad area)

-- there are some programs around the country that give people houses, maybe for $1. Requirements differ. Some require low income, some require more income, some require that you be employed. Some require you to fix up the home and live in it for at least 5 years. The houses are usually abandoned properties.

-- if you can manage to squat in a building for a certain amount of time, like 7 years, but law varies by community, I think, it's yours.

Your bad credit may or may not affect you getting a house if you:

-- arrange a rent-to-own agreement

-- get someone with good credit to co-sign any loans or mortgages

-- get a homeowner to finance the sale of his home to you

Under 500 is really low for a credit score, but credit score isn't the only factor. Your credit rating (history and credit report) also plays in. Points are taken off your credit score for moving a lot, for example, but your credit report may be okay if you pay your debts. Other things, do too, like how much money you can put up for a downpayment.

You may be able to get mortgage loans from the VA if you're a veteran or from a credit union more easily than from a regular bank.  

Answer 4

In this credit environment you might have a hard time, you should start repairing your credit, this article lists several tips on how to do so, http://www.monitorbankrates.com/how-to-b...