Why to avoid bad credit home loans in Houston: Your best options

bad credit home loans houston

Not being able to get a home loan can be a very distressing experience for a prospective home buyer. Conventional lenders turn down a large number of mortgage applications due to bad credit and lack of income verification. Other reasons include identify theft, foreign nationality and self-employment. Home buyers feel disheartened particularly when they realize that they can’t get a mortgage despite being financially disciplined.

It makes a lot of them feel desperate.  And that’s why they start looking for options which push them deeper into financial troubles. Here at Shop Owner Finance, we work with credit-challenged home buyers, so we have seen their struggles up close.

There are many types of bad credit home loans available in Houston. The majority of them are not the right choice for you. We recently wrote an article on how to get buy a home with bad credit. Read it to know about all the legitimate options you can explore. Owner financing is one of these good options. Click here to know how owner financing works in Houston TX.

Bad credit home loans

Many home buyers try to explore risky options such as hard money lending.

Hard money lenders usually charge a hefty interest rate. These loans are short-term, so they are a good fit for real estate investors. Regular home buyers should steer clear of such financing options.

Hard money lenders anyway look at your credit history just like conventional lenders do. If your credit score is not good enough, you will have a hard time getting a hard money loan.

If you are looking for a bad credit home loan, owner financing is a good option. In an owner financing arragement, there is usually no need for credit check or income verification. However you should pay attention to financing terms and keep a lot of other important things in mind when agreeing to an owner financing arrangement. We recently wrote an article explaining some of the most important things you should take into consideration.

An owner financing arrangement should help you improve your credit score. Here at Shop Owner Finance, we help credit challenged people buy homes with owner financing. Their monthly payments are reported regularly to credit bureaus through a note servicing company.

It should also allow you to refinance with a conventional mortgage any time you want. If there is any condition with regard to a balloon payment, make sure you are comfortable with it.

For example, we help our client get owner financing on any home they want. There are no balloon payment requirements and you can refinance any time you want.

Some other options that you can explore if you are struggling with credit are FHA-backed housing loan and home loans from credit unions.

In conclusion

Being turned down by a bank is usually not end of the world. You can explore many other financing options including owner financing. The important thing is not to get into something you don’t understand. Explore all the options before choosing the one that aligns with your best interests.

If you are interested in learning more about our real estate brokerage services in Houston, visit this page. Click here to watch some of our clients explaining how our system works. Start the search for your dream home by clicking here and get in touch with us today.

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Angel & Francis
Angele and Francis bought their with home with owner financing after moving to America just 11 months earlier. They are now enjoying the home with their 3 beautiful children.
Angela
After 3 years unsuccessfully trying to buy a home, Angela finally got her dream home with owner financing. Scheduled to close just days after hurricane Harvey struck, her "miracle home" was the only home not to flood in a neighborhood that had several feet of flooding even a week after the hurricane.
Barbara
Referred by her loan officer, Rick, Barbara was able to finally get her dream home on the water in Galveston.
Araceli (in Spanish)
Araceli and her family relocated from California. Self employed and unable to qualify for a loan, they used our program to get owner financing on a brand new home.
Steve and Cheryl
After a previous divorce and loss of credit, Steve was able to acquire a new home for him and his girlfriend with the help of Til Lowery.
Aicha
Aicha and her family purchased a brand new 5 bedroom home with owner financing and were so grateful to own a home even better than they thought was possible!
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