Banks want three qualities in a perfect borrower:
- Stable income
- Attractive credit history
- Low debt-to-income ratio.
If a potential borrower lacks in any one (or more) of these, the potential borrower may find qualifying for a loan difficult.
Credit rating is one factor in making a loan decision. Given your bad credit, it will be more challenging to get approved for a loan.
Keep in mind, however, that if you have accumulated equity or have a sizable down payment, that could provide the cushion in an LTV (loan-to-value) calculation to get you approved. Also, your income will be a major (possibly the most important factor) as it will determine your DTI (debt-to-income ratio). Most of all, it cannot hurt to apply and see what lenders think of your own situation.
I hope that his helps you make the right decision for your particular situation, but be sure to shop around and find a loan that meets your needs. Spend a few minutes to learn if a no-cost mortgage is right for your situation.
I hope this information helps you Find. Learn & Save.