Setabay Private Hard Money Lender: Things to Consider When Selecting Arizona bad credit mortgage lender

If you have bad credit, you will most likely find yourself unable to secure financing for a home mortgage through a bank. Most likely you will need to find an alternative Arizona bad credit mortgage lenders that specialize in bad credit and subprime home loans. All bad credit lenders are not created equal and it is important to select carefully to get the best deal.

If you have bad credit, finding a loan from a traditional bank can be difficult. Intense regulations by the federal government combined with over-cautious banks has led to the 2010 Dodd-Frank Act and a host of new rules regulating the mortgage market. In addition to new regulations, banks are still hurting from the housing crash of the mid-2000s. Not only were there losses from foreclosure, but also serious and founded allegations that banks knowingly sold bad subprime loans to investors as well as giving out loans to very risky borrowers. Several major banks had to pay out billions of dollars to settle cases of financial fraud during the financial crisis. These factors have led to banks to resist efforts to open up lending to borrowers with bad credit.

This lack of bank financing for borrowers with bad credit has led to new dynamic in the housing market that makes it almost impossible for borrowers with a low FICO score to obtain a home mortgage. However, a home mortgage is one of the best ways to help rebuild a credit history. Also, nearly one quarter of Americans have a “poor” credit score, meaning it is below 620. The restrictive lending climate has made it almost impossible for approximately 25% of Americans to secure a home loan.

The void in subprime lending from large banks has been filled by a number of Arizona bad credit mortgage lenders that are comprised of hedge funds, private-equity firms, and foreign banks. These investors are quite literally spending billions of dollars to help fill the subprime lending void. But not all of these firms are there to help. It is important to consider a number of factors when selecting Arizona bad credit mortgage lenders.

How to Evaluate Arizona bad credit mortgage lenders

When you are looking for a bad credit lender in Arizona, it is essential that you do your homework to find a legitimate, legal lender. A few things to consider when selecting your private lender:

Where is the firm based? This is especially important because different states have different real estate laws and licensing requirements. Ideally, you want a lender that is based in your state to ensure that they know the ins and outs of law pertaining to local real estate transactions.
Where is the funding coming from? If it is a foreign investment company or bank, you need to also do some further research on how stable the money source is. In addition, depending on what foreign bank the money that is funding your loan comes from, it may go towards causes or organizations that are against your beliefs. You may also want to think about how likely it is that the firm will sell your loan to an investor or investment group. Although a sold loan is not inherently negative, it is possible that your loan could be sold to a less stable third party.
Who is in charge of the firm? The firm should be headed by a licensed broker who is knowledgeable about state and federal mortgage laws.
Do I like the agent I am working with? This may seem trivial but it is ultimately a very important question to ask yourself. You will need to work with your loan agent very closely and trust his judgement and character. It is important that you can trust him and that he is honest with you.

Finding a lender you can trust is key to making your home ownership dreams come true.

Talk with a financial professional, mortgage broker, or real estate agent to learn more about various Arizona bad credit mortgage lenders. A good recommendation combined with thorough research can help you find the best lender for you and your family.