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Posts tagged credit restoration
Rent to Own Houses are Becoming More Popular!
Jan 25th
As the lending environment continues to experience stress, qualifying for a mortgage loan is getting more difficult. People that would have easily gotten a home loan just a few years ago are being declined and forced to look for other options. With the disappearance of stated income loans, even people who cannot verify their income that have perfect credit are being declines.
As a result, rent to own houses are becoming a popular step towards home ownership. It works to the advantage of the future homeowner for several reasons.
First, it let’s them lock up the home of their dreams now. The ability to move in while restoring credit is very attractive to many people.
It is very important for many people to feel like the home that they live in belongs to them. While not quite the same, renting to own can offer some of the same benefits of home ownership. Since the ultimate plan is to buy the home, it feels more like their own from the start. Since most rent to own contracts allow improvements to be made without consulting the current home owner, many tenants take advantage of this and make changes to suit their tastes. This further makes the home feel like their own.
There are also benefits financially. Rather than just throwing money away on rent, a portion of each payment goes towards the down payment in the form of the rent credit. In addition to this, because the purchase price is generally determined at the time of contract execution, the future homeowner can benefit from any appreciation that happens during the rental term. Due to the rent credit and appreciation, many people find that when it comes time to get a mortgage, little or no additional down payment is required. Additionally, many lenders will count the transaction as a refinance, further eliminating the need for an additional down payment.
Easy Ways to Establish Credit
Dec 7th
If you want to learn more about how to establish credit or how to fix bad credit then you will want to read this article. Getting good new credit is a critical part of any credit restoration process. We will be discussing three easy ways to get new credit.
Perhaps the easiest type of credit to get when you have a low or no credit score is a secured credit card. When you apply for a secured credit card, you will be asked to place a deposit with the lender. You will then be issued a credit line equal to that deposit. Because the lenders have cash to secure your credit line, there is typically no credit qualifying at all for a secured credit card.
You can also look for department stores and gas companies that offer credit cards. These companies typically have very relaxed underwriting guidelines because they are hoping that having credit will inspire you to spend more money in their stores. Using a gas card to reestablish your credit can be a good idea since gas is something you are going to spend money on anyway! Just be careful if you decide to get a department store card. It isn’t something you should do if you think you will be tempted to over spend.
The next place you should look to establish credit is your bank. While many people assume that a bank would not be willing to issue them a loan when their credit is bad, this is not always the case. Most banks are happy to issue you a CD (or certificate of deposit) loan regardless of your credit history. Like a secured card, you will be required to place a deposit with the bank. In this case, your deposit will be a CD. Then, you will take out a loan against this CD. Yes, you will be paying interest on you own money. Just remember – your ultimate goal is to reestablish your credit history.
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