Adjustable Rate Mortgages: Arizona Home Loans with Bad Credit

If you have a credit score of less than 640, you probably have trouble qualifying for a home in Arizona. If you find this position you want to look into programs that will allow you to qualify for Arizona home Loans with bad credit.

A bad credit score in terms of obtaining a home loan is classified to be at or below about 640, but this has varied with time and location. However, according to national credit bureaus, the average American’s credit score is around 678, meaning that most people don’t have perfect credit. If you have bad credit, there are a number of events that could have gotten you there that are beyond your control. Divorce, job loss, inability to make mortgage payments due to an over-inflated housing market, and the recent recession are all factors that have negatively impacted may people’s credit scores.

If you are looking for Arizona home Loans with bad credit you are not alone. 

Approximately 42 million Americans have a sub-prime credit score. A home loan can be a good way to rebuild your credit as long as you plan on making on time payments. One program that is available to sub-prime borrowers seeking an Arizona home Loans with bad credit is an adjustable rate mortgage or ARM.

An ARM is a mortgage that is different than a 30 year mortgage in that it is for a shorter period of time, anywhere from 1 to 7 years. The most commonly offered types of ARMs are 3 and 5 year ARMs. During that time period you have a low interest rate, usually below the prime rate. This low rate means lower payments. The lower monthly payments helps many individuals and families qualify for an ARM who would not be able to qualify for the higher payments of a traditional mortgage. After the initial period, the rate of an ARM adjusts or resets to a higher than prime rate. This will increase the monthly payment amount based on the interest rate you are being charged. Every ARM has certain maximums depending on the type of loan. There is a maximum amount you can be above the prime rate as well as a maximum number of times the loan can reset.

One of the major criticisms with adjustable rate mortgages has to do with what happens after the rate adjusts. Because the interest rate increases, the amount of your monthly payment will also increase. In the mid-2000s, the increase in payments combined with the decline in the housing market led to a large number of sub-prime foreclosures. This has led to many law makers and media outlets to criticize ARMs as being irresponsible lending practices. However, an ARM can be a good option if you are smart about how you use it.

An important thing to keep in mind with an adjustable rate mortgage and really for any Arizona home Loans with bad credit, is to not borrow more than you can afford. If you cannot afford the payment on a $200,000 mortgage at a 30 year rate, do not borrow that much using an ARM, unless you are planning to move long before your rate resets. In addition, make sure to make smart real estate choices. Before you purchase a home look at the area and the overall price history. Don’t buy unless you are relatively certain that the home will increase in value. Also keep in mind that federal regulations require a 10% down payment up-front. Make sure that you have this money available before you close on your ARM loan or you will not be able to close. If the 10% down payment is more than you have available in savings, you might want to consider and FHA adjustable rate hybrid option. This loan type offers many of the benefits of an ARM with a lower down payment and government insurance.

ARMs for Prime Borrowers

An adjustable rate mortgage is a great program for borrowers needing an Arizona home Loans with bad credit, but it is also a great option for prime borrowers in certain situations. An ARM allows you to take advantage of low monthly payments and can save you a significant amount in interest payments. If you are wanting to purchase a property and will be able to sell or refinance before the rate resets, an ARM can be good option even if you would qualify for a traditional mortgage. Many savvy borrowers take advantage of adjustable rate mortgages to make real estate investments and purchase fix and flip houses.

An adjustable rate mortgage can be a good option for sub-prime and prime borrowers alike.

Find a mortgage broker to fully discuss your home loan options and determine if an adjustable rate mortgage is a smart financial decision for you. 

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Arizona Mortgages for Bad Credit: FHA Loans

An FHA loan is a home loan backed by the Federal Housing Administration. It is a type of mortgage that allows lower income and bad credit borrowers to obtain home loans. If you are searching for Arizona mortgages for bad credit, and FHA loan may be the perfect option for you.

If you have bad credit, a home mortgage is a valuable tool for rebuilding your credit, but it may seem almost impossible to obtain. Most banks will turn away borrowers with a credit score of less than 640. However, nearly 25% or 42.5 million credit using Americans fall into this category. If you find yourself searching for Arizona mortgages for bad credit borrowers, you might want to look into an FHA loan. There are FHA loan programs with a FICO Score as low as 550.

The Federal Housing Administration is a government agency that is responsible for helping to insure home loans. In order to qualify for an FHA loan, an applicant must make arrangements with an FHA accredited lending institution. The federal government via the Federal Housing Administration then insures the lending institution against loss in case the borrower fails to pay their mortgage on time. The borrower pays an insurance premium for this service of .8% of the loan amount upfront (usually financed into the loan amount) as well as monthly PMI payments. In order to qualify for an FHA the borrower also has to make a 3.5% down payment at closing.  An FHA loan primarily serves individuals who cannot afford to make a traditional down payment or who may have less than perfect credit.

Banks and lenders are more willing to give out FHA loans as Arizona mortgages for bad credit because there is a two tiered system of insurance to prevent loss in case of default. The first type on insurance is an upfront payment that is rolled into the cost of the loan. The second type of insurance is a mortgage insurance premium or MIP. The MIP is paid monthly and is added onto the cost of the mortgage payment. The MIP is a percentage of the loan amount that is determined by the value to debt ratio of the property as well as the length of the loan term. If you decide to obtain and FHA loan, it is important to keep in mind that you will make higher monthly payments due to these types of insurance.

The FHA Loan Process

If you have been researching Arizona home loans for bad credit and have decided that an FHA loan is a good option for you to purchase Arizona real estate, it is important to know what to expect in the qualification process. One key detail is that the Federal Housing Administration does not make loans. In order to obtain a loan you need to find an FHA approved bank or mortgage broker. Each bank can set its own interest rates and loan terms so it is important to shop around. A mortgage broker may be a better option because a broker can shop different banks for you to find the most favorable loan terms.

Once you have found a lender, the lender will assess you and determine if you qualify for a loan. You will be asked for proof of income and the lender will run your credit. If you have bad credit, you may be charged a higher interest rate but will often still qualify for an FHA loan due to the government backing. In addition, FHA loans allow for certain economic set-backs that can allow many bad credit borrowers to qualify for a home loan.

If you have little credit or bad credit, the FHA will also allow for a co-signer or co-borrower. Unlike other loans, the co-borrower does not have to live at the property with you but you can use their credit score to help you qualify for the loan. The FHA also has a hybrid adjustable rate mortgage program that can allow borrowers with high debt to income ratios to take advantage of low interest rates to purchase a home.

If you are looking for Arizona home mortgages for bad credit, an 

FHA loan may be a good option for you.

As with all loans, there are pros and cons related to FHA mortgages. They can be a good tool to help low-income buyers or borrowers with bad credit, or first time homebuyers without the resources to make a hefty down payment. It is important that you meet with an Arizona mortgage broker to discuss FHA loans along with other programs related to Arizona mortgages for bad credit. Talking with a broker will ensure that you know all your options and can make an informed decision about your home purchase.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Qualifying for an Arizona Mortgage with Bad Credit

If you have less than perfect credit, you can still purchase a home in the Grand Canyon State. There are many options for borrowers looking to find an Arizona mortgage with bad credit. Learn about the different programs available and how to qualify for each type of loan to make your real estate dreams a reality.

Having bad credit can seem like an impossible situation. If you have a bad credit score, you will have trouble qualifying for a mortgage, getting a car loan, or even obtaining a store credit card. You may even have trouble finding a new job because many employers run your credit score. The only way to improve your credit is to make on time payments which is impossible if you can’t qualify for credit to make payments on. You may feel like there is no way out. Luckily, there are programs that allow applicants to obtain an Arizona mortgage with bad credit. A mortgage is a great way to begin to rebuild your credit history.

A bad credit score in terms of obtaining a home loan is classified to be at or below about 640, but this has varied with time and location. However, according to national credit bureaus, the average American’s credit score is around 678, meaning that most people don’t have perfect credit. If you have bad credit, there are a number of events that could have gotten you there that are beyond your control. Divorce, job loss, inability to make mortgage payments due to an over-inflated housing market, and the recent recession are all factors that have negatively impacted may people’s credit scores.

If you are looking for an Arizona mortgage with bad credit you are not alone. Approximately 42 million Americans have a sub-prime credit score. Don’t let your bad credit keep you from owning a home when there are so many bad credit loan programs available to Arizona residents.

Types of  Arizona Loans for Borrowers with Bad Credit

One loan type that is available for borrowers in the market for an Arizona mortgage with bad credit is an adjustable rate mortgage or ARM. An adjustable rate mortgage is a short term mortgage with a term of anywhere from 1 to 7 years. During your initial term the interest rate on your mortgage is very low, usually below the prime rate. This makes your payment relatively low as well. The lower monthly payment allows borrowers with bad credit to qualify when they may not be able to for a traditional 30 year loan. After the initial term of you loan, the interest rate resets and your payment may be higher. This can be a good option for someone who is on the road to repairing his credit and will be able to refinance to a 30 year mortgage at the end of the adjustable rate term. One thing to keep in mind with an ARM is that they require a 10% down-payment. This helps ensure that the property value will not drop significantly below the loan amount.

A second type of program that a borrower in Arizona with bad credit might consider is a hard money loan. A hard money loan is designed as an investment strategy and isn’t a good option for owning a home you intend to live in long term. A hard money loan is backed by a group of investors, rather than a bank. The investors will look at your property purchase as well as renovation plans to determine if the loan is a good investment. If you have bad credit they are more likely than a bank to look past your credit score if you have a sound investment idea. Hard money loans are short term loans primarily designed to fix and flip a property for a profit.

A final type of loan that can help individuals looking for an Arizona mortgage with bad credit qualify to purchase a home is an FHA loan. FHA stands for Federal Housing Administration and this entity gives out a type of government backed loan. Borrowers are only required to make a 3.5% down-payment so it can help keep some cash in your pocket. In addition, the loan is insured by the federal government so banks are more willing to lend to sub-prime borrowers. This insurance will cost you though. Be aware that if you take out an FHA loan, you will be required to pay make PMI payments. These can be anywhere from 80 to over 200 dollars a month depending on the amount of your loan. You will make them until the loan amount that you have is less than 80 percent of your purchase price. The PMI payments are a type of insurance you pay to help secure the investment in case of default.

Talk with a mortgage broker to determine the best fit for your home buying needs.

Programs and loan types are constantly evolving and changing. A broker can help you choose the right program to fit your financial needs. 

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Arizona Bad credit home loans: Investing in Real Estate Using Hard Money Loans

If you have bad credit you most likely think that real estate investing is beyond your reach. However, with Arizona Bad credit home loans and hard money lending there are options for individuals with bad credit to take advantage of real estate investment opportunities.

Most financial planners agree that real estate investing has historically been a sound investment. Real estate has consistently earned money over time and is a way to help build your investment portfolio and personal wealth. However, for many individuals with bad credit, real estate investing has been beyond their reach using traditional loans. Approximately 42.5 million Americans have a bad credit score and are considered sub-prime borrowers. Typically this means that a borrower with a FICO score of less than 640 will be denied a home loan by a bank. If you are in the market to start real estate investing but you have bad credit, there are a variety of Arizona Bad credit home loans and loan programs available to you.

One type of loan available to sub-prime borrowers is a hard money loan. A hard money loan is a specialized type of real estate backed loan. The lender is an investor or group of investors rather than a bank. The lender offers short term capital loans to purchase investment properties. The term of a hard money loan is generally no more than two years and is designed to make money on real estate for both the borrower and the lender. Hard money lenders focus on the value of property being purchased rather than the assets or credit score of the borrower. For this reason a hard money loan is an invaluable opportunity for an investor looking for Arizona Bad credit home loans to purchase a property as a short term investment.

Hard money loans are available for all property types including commercial, residential, multi-family, and even land loans. Each lender or group of lenders determines the requirements for what types of loans they will give as well as how much money they will lend. If the lender gives loans on residential properties he/she/they are required to be licensed through the National Mortgage Licensing System (NMLS). In order to sure that the lender you are using meets all requirements, it is best to use a broker or investment team that specializes in hard money lending.

Hard Money Lending Regulations

Although hard money loans have significantly less regulations than traditional mortgages, there are certain federal regulations that apply to hard money lenders. For most property types, hard money lenders do not require the same income verification or credit score guidelines that traditional banks do. This is part of what makes them ideal Arizona Bad credit home loans as they look at the value of the property from an investment standpoint, not based on credit or income. However, it is important to note that hard money loans are more risky for the lender and therefore come with a higher interest rates. In addition, if you are taking out a hard money loan on a residential property, you will be required to some proof of ability to repay the debt. This means some type of proof of income though it is usually less stringent than what a bank requires.

When you take out a hard money loan, the property that you are investing in becomes the collateral. If you default on the loan, the lender will seize the property to protect its investment. If you take out a hard money loan, make sure that you will be able to pay the loan back in full at the end of the term by either selling the property or other means. When you sell the property you keep any money that is earned above the amount of the loan which is why hard money lending can be a great Arizona Bad credit home loans program to allow individuals with bad credit to invest in the real estate market.

Talk with a mortgage broker or investment company about hard money lending.

A financial professional or mortgage broker can help you decide if a hard money loan is a smart financial choice. It is a great way for Americans with bad credit scores to start taking advantage of real estate investing. In addition, hard money loans can benefit prime borrowers as well. If you already own a home you may not qualify to purchase an investment property based on your debt to income ratio. A hard money loan can be a great work around to get you into the real estate market. Call a broker or your financial adviser to learn more today. 

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Arizona Mortgages for Bad Credit: Adjustable Rate Mortgages

An adjustable rate mortgage is a type of mortgage available in Arizona for individuals with less than perfect credit. If you are looking into Arizona mortgages for bad credit, an adjustable rate mortgage might be a good option.

If you have bad credit, you may feel alone and like a failure. You may have trouble getting a car loan, mortgage, or even a store credit card. You may have even lost out on job opportunities due to your FICO score. This can feel isolating and embarrassing. However, you are far from alone. It is estimated that approximately 25% of credit using Americans have bad credit with a credit score below 640. In addition, the average credit score of a credit holding American is about 678, which is far from perfect. In short, you are not alone.

A variety of factors can lead to a low credit score. Divorce, job loss, a sudden change in income, or a downturn in the economy are all factors out of your control that can lower your credit score. If you find yourself in the position of having less than perfect credit, you can still qualify for a home mortgage. When you are looking for Arizona mortgages for bad credit, it is important to know and understand all of your mortgage options as well as the cost that the credit will have in the long run. One option that can work for many families is an adjustable rate mortgage.

Adjustable Rate Mortgages for Arizona mortgages for bad credit

An adjustable rate mortgage or ARM is a good options for individuals needing Arizona mortgages for bad credit. An ARM is a mortgage that is different than a 30 year mortgage in that it is for a shorter period of time, anywhere from 1 to 7 years. During that time period you have a low interest rate, usually below the prime rate. This low rate means lower payments. The lower monthly payments helps many individuals and families qualify for an ARM who would not be able to qualify for the higher payments of a traditional mortgage. After the initial period, the rate of an ARM adjusts or resets to a higher than prime rate. This will increase the monthly payment amount based on the interest rate you are being charged. Every ARM has certain maximums depending on the type of loan. There is a maximum amount you can be above the prime rate as well as a maximum number of times the loan can reset.

One of the major criticisms with adjustable rate mortgages has to do with what happens after the rate adjusts. Because the interest rate increases, the amount of your monthly payment will also increase. In the mid-2000s, the increase in payments combined with the decline in the housing market led to a large number of sub-prime foreclosures. This has led to many law makers and media outlets to criticize ARMs as being irresponsible lending practices. However, an ARM can be a good option if you are smart about how you use it.

An important thing to keep in mind with an adjustable rate mortgage and really for any Arizona mortgages for bad credit, is to not borrow more than you can afford. If you cannot afford the payment on a $250,000 mortgage at a 30 year rate, do not borrow that much using an ARM, unless you are planning to move long before your rate resets. In addition, make sure to make smart real estate choices. Before you purchase a home look at the area and the overall price history. Don’t buy unless you are relatively certain that the home will increase in value. Also, look at your credit. It may be bad now, but are you taking steps to rebuild it? If the answer is yes, then you can decide if you will be able to refinance to a 30 year mortgage before your ARM resets. If you will be able to refinance, you won’t ever have to make higher payments because your mortgage rate adjusts.

Finally, an adjustable rate mortgage isn’t only for borrowers needing Arizona mortgages for bad credit. An ARM can be a good option for many investors who are going to live in a home for a short time, fix it up, and sell it for a profit. It can also be a good mortgage option for families who will only live in the home for the initial term of the mortgage and will sell and move before it resets.

If an adjustable rate mortgage sounds like a good option for you, call a mortgage broker to learn all the details you need to know.

A broker can help you navigate the ins and outs of adjustable rate mortgages to help you choose the right loan. Down payment minimums change and so do interest rates. A broker can get you the best deal to purchase your new home, regardless of your bad credit score. Call today to learn more.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Arizona Home Loans with Bad Credit

Many families think that home ownership is beyond their reach because they can’t get Arizona home Loans with bad credit. However, this is simply not true as there are a variety of programs available to help borrowers with bad credit purchase a home in Arizona.

If you have been denied a home loan in the past due to bankruptcy, bad credit, or sub-prime credit, you may think that purchasing a home is out of your reach. Many borrowers don’t know that there are a variety of programs available to them, even if they have less than perfect credit. Don’t let bad credit hold you back from obtaining a new home for your family or as an investment. Learn about your options for purchase and talk with a mortgage broker.

One program that can help individuals looking for Arizona home Loans with bad credit qualify to purchase a home is an FHA loan. FHA stands for Federal Housing Administration and this entity gives out a type of government backed loan. Borrowers are only required to make a 3.5% down-payment so it can help keep some cash in your pocket. In addition, the loan is insured by the federal government so banks are more willing to lend to sub-prime borrowers. This insurance will cost you though. Be aware that if you take out an FHA loan, you will be required to pay make PMI payments. These can be anywhere from 80 to over 200 dollars a month depending on the amount of your loan. You will make them until the loan amount that you have is less than 80 percent of your purchase price. The PMI payments are a type of insurance you pay to help secure the investment in case of default.

Another loan type that is available for borrowers in the market for Arizona home Loans with bad credit is an adjustable rate mortgage or ARM. An adjustable rate mortgage is a short term mortgage with a term of anywhere from 1 to 7 years. During your initial term the interest rate on your mortgage is very low, usually below the prime rate. This makes your payment relatively low as well. The lower monthly payment allows borrowers with bad credit to qualify when they may not be able to for a traditional 30 year loan. After the initial term of you loan, the interest rate resets and your payment may be higher. This can be a good option for someone who is on the road to repairing his credit and will be able to refinance to a 30 year mortgage at the end of the adjustable rate term. One thing to keep in mind with an ARM is that they require a 10% down-payment. This helps ensure that the property value will not drop significantly below the loan amount.

A final type of program that a borrower in Arizona with bad credit might consider is a hard money loan. A hard money loan is designed as an investment strategy and isn’t a good option for owning a home you intend to live in long term. A hard money loan is backed by a group of investors, rather than a bank. The investors will look at your property purchase as well as renovation plans to determine if the loan is a good investment. If you have bad credit they are more likely than a bank to look past your credit score if you have a sound investment idea. Hard money loans are short term loans primarily designed to fix and flip a property for a profit.

The Truth about Bad Credit Mortgages

A bad credit score in terms of obtaining a home loan is classified to be at or below about 640, but this has varied with time and location. However, according to national credit bureaus, the average American’s credit score is around 678, meaning that most people don’t have perfect credit. If you have bad credit, there are a number of events that could have gotten you there that are beyond your control. Divorce, job loss, inability to make mortgage payments due to an over-inflated housing market, and the recent recession are all factors that have negatively impacted may people’s credit scores.

If you are looking for Arizona home Loans with bad credit you are not alone. Approximately 42 million Americans have a sub-prime credit score. Don’t let your bad credit keep you from owning a home when there are so many bad credit loan programs available to Arizona residents.

If you want to take control of your home ownership or real estate investment dreams, stop letting credit hold you back.

Call a licensed Arizona mortgage broker today. A broker can discuss your options regarding Arizona home Loans with bad credit and help you find the loan to best fit your needs. Stop waiting, call today!

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Traditional Bank Loan or Arizona Hard Money Loan

If you have noticed lately that traditional bank loans are getting more and more difficult to get when it comes to your real estate needs, then you aren't alone. In fact, based on paperwork alone, you’re looking at a lot of time wasted. It might be worth your time to look into Arizona hard money loans for the real estate investor.

This might seem confusing. Most people don’t even know that you can get a loan without a bank, but with Arizona hard money loans, you absolutely can. And the amount of paperwork you don’t have to do will absolutely stun you. Banks made a huge mess out there, giving loans to people who shouldn't have them and now they are really cracking down and making it really difficult to get a loan if your credit isn't in tip-top shape and that’s where Arizona hard money loans come in.

No longer will you have to jump when the bank says jump, instead you can have the money you need right when you need it. Consider the types of Arizona hard money loans that you can get. You have Private money lender Arizona or you have hard money lender Arizona. Both can help you make the payment you need to get the property that you want. Whether you are looking to fix up a property or you are looking to put some money down before someone else buys the property, Arizona hard money can help you get the money that you need. You won’t even have to prove your credit score. 

Your private money lender Arizona or hard money lender Arizona doesn't mind what it is. Your credit score has nothing to do with the property you want the money for. Take the time to think about getting Arizona hard money for your next investment.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027