subject: Very Poor Credit Home Loans – 3 Things to Watch Out For Before You Sign [print this page] Very Poor Credit Home Loans 3 Things to Watch Out For Before You Sign
If you're in the market for a poor credit home loan there 3 things you need to be aware of before you proceed. Predatory lending has caused people's homes to go "underwater" meaning that the amount of their loans more than the value of their homes.
You can avoid predatory lenders by doing your homework. In the end it will pay off because you'll get the best service for your situation.
Choosing a Reputable Lender When you're searching for a poor credit home loan lender there are a few things you need to be aware of. First, look to see if the lender is eager to give you a loan especially if they contact you first. Also check with the BBB to see if there have been any complaints filed against the company.
Read and Understand Your Contract It's important that you read and understand the terms of your loan agreement before signing it. Many people who are now underwater didn't' do this and were lured into signing a contract with a low introductory interest rate which skyrocketed after a few years. Some other things to look out for in the contract are large lump sum payments due at the end of the agreement, balloon payments and other fees. The other thing to look out for is lenders offering you a loan based on the value of your house rather than your income. Predatory lenders bank on the fact that you won't read the fine print and in the end they profit while you fail.
Keep Your Emotions in Check - The final point to be aware of has to do with you. Owning a home is a wonderful experience and when done right will put you on the path to success. However if you give in to your emotions and purchase more than you can afford you could be setting yourself up to fail. Make sure to run a quick budget before looking for a loan to see how much house you can afford. You need to make sure that as a home owner you're not cash strapped and have nothing left over for emergencies. If something should happen and you can't make your payments the bank will repossess your house or other assets.
If you do your homework and keep your emotions in check chances are you'll find a poor credit lending service that works for you. Poor credit home loan services are designed to help you achieve your goal of home ownership and following the 3 outlined tips above will help you hold on to the home you worked so hard to get and love.
