Bad Credit Mortgages

Less-Than-Perfect Credit - Bad Credit - You Could Still Be Eligible For Financing

No matter how bad you think your credit is, you could still be eligible for mortgage financing.
Regardless of whether you have a bankruptcy or delinquencies or judgments on your credit report, you may still obtain mortgage financing for a home purchase, refinance, or even cash out of your current home equity. It doesn't matter whether you have charge-offs, collections, or tax liens on your credit report, as long as you can meet the specific guidelines for loan approval, bad credit mortgage financing is possible. In addition to having a certain credit rating, you will still need to be employed, have sufficient income and assets and in some cases, have a sufficient down payment depending on the type of mortgage loan you are applying for.

North Country Mortgage Banking Corp. offers a range of mortgages for good credit or bad credit. Bad credit mortgages often have higher interest rates than most current mortgage loan rates.

Do you qualify for a bad credit mortgage?

Submit your information and we will contact you.

What Credit Category Best Fits You?

A-Credit

This is the best credit rating you can possibly have. Given this credit rating, you are eligible for the very best mortgage interest rates on the market as well as eligible for a multitude of mortgage products. Typically, Underwriter's will heavily weigh your credit rating and rule in favor of you, should they be faced with marginal application weaknesses when reviewing your mortgage loan. For example, if the debt-to-income ratio exceeds guidelines, the Underwriter will likely approve the mortgage loan. Also a 30 or 60 day late on a credit card could be overlooked as well.

For all those consumers that do not fit into this credit category, will fit into the following credit categories.

A-minus credit:

Can have the following credit issues during the past 2 years:

• Charge-offs/Collection accounts (accounts with small balances)
  
  
• Hospital/medical bills, (including hospitalization), may be disregarded by Underwriting
  
  
• Regarding credit payment history, the borrower can have no more than two 30 days late payments, or one 60 days late payment on revolving or installment credit.
  

B Credit:

Can have the following credit issues during the past 18 months:

• Up to four 30 day late payments, or
  
  
• Up to two 60-day late payments are acceptable on revolving and installment debt. Depending on the situation, a 90-day late payment could be allowed within the last year
  
  
• Charge-offs, or collection accounts, with small balances (totaling less than $1,000), may be acceptable
  
  
• Unpaid collection accounts less than four years old must be paid
  
  
• Bankruptcy or foreclosure that had been discharged or settled previous to the 18 month time frame are acceptable

C Credit:

Can have the following credit issues during the last 12 months:

Installment Or Revolving Debt

• No more than six 30 day late payments,
  
  
• Three 60 day late payments, or
  
  
• Two 90 days late payments are allowed
  
  
• Open collection accounts and charge-offs may not exceed $4,000 and must be paid in full
  
  
• Bankruptcy or foreclosure that had been discharged or settled prior to the last 12 months is o/k.

D Credit:

This is the lowest credit rating you can achieve. These are people who have:

• Open collections accounts
  
  
• charge-offs,
  
  
• Judgments.

These all must be paid from loan proceeds.

If bankruptcy has been filed and discharged and is at least 6 months old, then this is acceptable. The same holds true for a foreclosure that is at least 6 months old.

Mortgage payments cannot be longer than 90 days past due.

Finally, you should know that categorizing consumers in to the various credit categories listed above could be somewhat subjective (and open to interpretation). The list of credit categories listed above is general industry guidelines. Ultimately, it is up to the Underwriter to determine the "creditworthiness" of the buyer.

Your Credit Rating Dictates The Down Payment Requirements

In general, people with less than perfect credit or bad credit usually are eligible for only up to 80% mortgage financing. The 80% mortgage financing is based off the appraised value or purchase price, whichever is less. This means the borrower will have to come up a 20% down payment or have 20% equity, if refinancing.

Income Requirements

Typically, the D.T.I. (deb-to-income ratio) for people with less than perfect credit is 45%-50%. This means the ratio of all debt divided by monthly gross income is 45%-50%. The standard ratio A credit borrowers is 36%.

Depending on the extent of credit problems, borrowers with less-than-perfect or bad credit can expect to pay higher than market interest rates for their mortgage home loan.

To learn more whether you would qualify for a bad credit mortgage loan, please click here.