Having no credit or bad credit can be discouraging when trying to get approved for a house loan, as this factor will make it harder to find a lender who will offer you a loan to buy a house. While it can be harder to get a loan with no credit or bad credit, it is not impossible to buy a house. In fact, there are several options you could consider if you are in this position and want to buy a home.
Get a Cosigner
The first option you could consider is getting a cosigner to help you buy a house. When you apply for a loan on your own, the lender will consider your credit and financial situations only. When you apply with a cosigner, the lender will consider not only your credit and finances but also the cosigner's credit and finances. If you choose to use a cosigner to get a loan, you will need to find a person who is not only willing to do this for you but that also has excellent credit.
Offer a Good Size Down Payment
A second option that could help you get approved for a loan is offering a good size down payment. If, for example, you want to buy a house for $150,000, offer to put down $50,000. While this might be hard for some people, there are others that may have this much cash available. When you offer a lot of cash as a down payment, it shows how serious you are about owning a house. If you default on the loan, the bank has little risk of losing the money they loaned you for the house, simply because the house will have a lot of equity in it from the start.
Look for a Lender that Specializes in Loans for People with No Credit
The other option you could use involves finding a lender who specializes in getting mortgage loans for people with no credit or bad credit. There are businesses that can help you find homes with owner financing and that don't require credit, only a down payment from you. The size of the down payment necessary may vary depending on your circumstances.
If you are ready to buy a house and need a loan to do so, you could look into these options. For more information about some of these options, look into businesses like SWE Homes.