How to Apply for a Mortgage Loan Without a High Credit Score

By Right Start Mortgage
November 21, 2021

Access to cash can provide a lifeline for individuals who need help with a few monthly bills. However, credit card denials and unapproved personal loans may cause a tremendous amount of frustration. Homeowners can apply for a mortgage loan without a high credit score.

About Cash-Out Refinancing 

When unsecured loans are not an option, a homeowner might qualify for a more affordable solution.

Many homeowners who make timely mortgage payments also have a few additional bills to pay each month.

Recurring credit card bills seem to take forever to pay off.

High-interest rates are a large part of the reason that credit card balances rarely change when the minimum payment requirements are made.

A cash-out refinance generally results in a larger mortgage balance that incorporates credit card debts and a variety of other bills.

Borrowers may also receive cash from their home equity to use for nearly any purpose.

Perform a Credit Check

Before contacting a mortgage lender, it is a wise idea to perform a credit check.

If any items are erroneous or if certain items have been resolved, the respective credit bureau should be advised to make the proper updates. Receipts or any proof that could clear the discrepancies should also be attached to the request for credit report updates.

Disputed information that becomes properly reported might increase a borrower’s credit score enough to secure favorable mortgage terms.

Gather Financial Documents

Without a high credit score, a mortgage lender may offer greater consideration for an applicant with a low debt-to-income ratio or several months of financial reserves.

For instance, a borrower with a high credit score and money in the bank to cover two months of mortgage payments might present more risk than a borrower with a median credit score and enough financial reserves to make timely mortgage payments for more than a year.

Therefore, a borrower should take additional time to list several bank accounts, retirement accounts and details about real estate ownership or any income-producing properties on a mortgage application.

Compiling tax returns for the past two-years, W-2’s for the last two years, pay stubs to cover the past 30 days and documentation for any ongoing income sources could also give an underwriter additional factors to consider.

Apply for a Mortgage Loan Online

A borrower should thoroughly complete every section on a mortgage application.

Be sure to complete personal information, details about the subject property and also list accurate income and asset details to ensure that a lender has more to consider than an average credit score.

Right Start Mortgage has loan officers who are dedicated to providing superior levels of customer support.

Contact us today to learn more about our debt consolidation programs for borrowers with less than perfect credit or to apply for a home mortgage loan

* Specific loan program availability and requirements may vary. Please get in touch with the mortgage advisor for more information.

Get in Touch With Our Team

We’re happy to connect with you and answer any questions you might have. Reach out today!