Bad Credit Home Loans in Champaign Illinois
The bad credit mortgage is often called a non-prime mortgage or alternative lending and is offered to Champaign homebuyers with low credit ratings. Due to the low credit rating, conventional mortgages are not offered because the lender sees this as the homebuyer having a larger-than-average risk of not following through with the terms of the loan. Lenders often charge higher interest rates on non-prime mortgages in order to compensate for the higher loan default risk that they are taking.
Candidates For Champaign Bad Credit Mortgages
Some people with poor credit profiles or a small down payment may have trouble borrowing from conventional lenders. One alternative to consider is obtaining a Federal Housing Administration loan or a non prime mortgage. These loans have liberal underwriting requirements which allow people to purchase a home with a poor credit score and as little as a 3% down-payment. Non Prime and FHA borrowers can qualify with credit scores between 500 and 620. Veterans may want to explore low-cost VA loan opportunities.
Most borrowers use a non prime mortgage with the home buyer planning on refinancing at some point into a more appealing loan with a lower rate. However if the homeowner still has outstanding credit issues or the mortgage market tightens up then they might not be able to refinance. The higher rate can cause a prohibitively higher monthly payment, & an inability to refinance can mean a loss of home ownership.
The below items are the general guidelines that can be used as a rough rule of thumb when determining whether a consumer may be a candidate for a non prime, FHA or VA loan:
- 1 Day out of Foreclosure, Bankruptcy, short sale, deed-in-lieu.
- Loans up to $1 million
- Credit scores down to 500
- Up to 100% LTV
- DTI up to 50% considered
- Owner-occupied, 2nd homes, and investment properties
- Non-warrantable condos considered
- Jumbo loans down to 500 score
- 5/1 ARM or 8 – 30-year fixed
- No pre-payment penalty for owner-occ and 2nd homes
- No active tradelines OK with housing history
- SFRs, townhomes, condos, 2-4 units
- Seller concessions to 6% (2% for investment)
Apply even with Poor Credit 888-882-1058
Champaign (English: /ˌʃæmˈpeɪn/) is a city in Champaign County, Illinois, United States. The city is 135 miles (217 km) south of Chicago, 124 miles (200 km) west of Indianapolis, Indiana, and 178 mi (286 km) northeast of St. Louis, Missouri. The United States Census Bureau estimates the city was home to 87,432 people as of July 1, 2017.[5] Champaign is the tenth-most populous city in Illinois, and the state’s fourth-most populous city outside the Chicago metropolitan area. It is included in the Champaign–Urbana metropolitan area.
Champaign is notable for sharing the campus of the University of Illinois at Urbana–Champaign with its sister city of Urbana. Champaign is also home to Parkland College which serves about 18,000 students during the academic year.[6] Due to the university and a number of well known technology startup companies, it is often referred to as the hub, or a significant landmark, of the Silicon Prairie. Champaign houses offices for Sony, and for the Fortune 500 companies Abbott, Archer Daniels Midland (ADM), Caterpillar, Deere & Company, Dow Chemical Company, IBM, and State Farm.[7]