Consumers with bad credit may find it exceedingly difficult to find a lender willing to approve their mortgage application. However, as Keith Gumbinger of mortgage information provider HSH Associates tells CNNMoney, it's not impossible.
"The belief is that you can't get a mortgage at all—but you can," said Gumbinger.
Tuck Bradford, branch manager with a mortgage lender, told the source that borrowers must meet several criteria to qualify for a loan: The should have the ability to make a down payment that's 20 percent of the home's value; a credit score that's at least 620; and a sufficient income so that no more than 28 percent of their earnings goes toward housing payments.
Should these criteria not be enough, however, Gumbinger tells the financial news website that consumers can turn to the Federal Housing Administration for assistance.
"The FHA is just about as free and easy as it was in the go-go days," said Gumbinger.
Even here, though, a bad credit report may still be too much of an issue for lenders to overlook. But oftentimes, a poor three-digit number is not the fault of the consumer, as data may appear on the credit report that are inaccurate or wrongfully reported. A credit lawyer can identify these negative marks, which should help increase the chances a consumer's loan request will be approved.