No Credit Check Mortgage Loans
No credit check mortgage loans are not for everyone and definitely not the recommended choice. Generally you want the bank to know your credit history so they are comfortable loaning to you. Only when a bank is confident in the risk they are taking do they charge the lowest interest rate possible. If you don’t give them all of the information they will be forced to assume the worse which means you get gouged in interest rates or you’ll have to make them comfortable some other way.
Perhaps there are some reasons you are looking for mortgage loans with no credit check. You just might have a few items on your report that would make the average, no training, no imagination, no real decision making capability mortgage broker turn and run. It probably isn’t as bad as you think, but I’m not one to judge. Then you’ll need to prepare for your no credit check mortgage loans with either a lot of money up front or a lot of expected cash flow.
Prepare for High Interest Rates
The one way the bank has to deal with no credit check mortgage loans is to charge a lot of money in interest. If you’re going to accept this fate you may end up paying hundreds of thousands of dollars in extra interest over the course of your loan. You probably have a little bad credit, you didn’t kill someone. You shouldn’t be gouged like that. The only way to avoid this is plan on paying extra payments every month. An extra payment a year can knock out about 7 years of payments on a 30 year loan. You can’t say you will make the extra payments; you must make the extra payments.
Prepare for a Large Down Payment
If you don’t want to pay high rates you can prepare for your no credit check mortgage loan by gathering a large down payment. The large down payment helps guarantee the equity in the home you’re trying to buy even if the market turns down a little bit. You’ll need at least 20% down, but perhaps even as much as 30% down before you have much hope of a decent interest rate without a credit check.
Have no Debt
The best way to qualify for no credit check mortgage loans is to not have any borrowing activity for seven years. This will give you a zero credit score and empty credit report. When you have a zero credit score you qualify for many special rates and loan programs.
Be wary of lenders of the no credit check mortgage loans that require very little identification or evidence at all. Any lender is going to require some form of evidence that you have the ability to make the payments. If the borrowing process is too simple there is likely a scam happening that is looking to get you to pay excessive fees, or lose your home after a few payments because you didn’t fully understand what you signed. Always check the lender with the better business bureau or online scam forums.