As much as home ownership is becoming more and more the norm, so is bad credit. With the ease of credit available, it has become increasingly easy to get too much credit and get in to financial trouble as well. These people still dream of owning a home and their united questions is “Is there such a thing as bad credit manufactured home loans?”
The answer is yes. You just have to know how to get them.
Home ownership is a desire and a dream for many if not most Americans. At one point in time, home ownership was for the rich and elite. Recently though, more and more Americans are becoming home owners and people feel increasingly compelled to join the party so to speak.
Lenders are more willing to lend money on real estate than just about any other type of loan. Consider the difference between a loan on real estate and a loan on a trip to Hawaii. If you enjoyed your trip to Hawaii and then proceeded to default on the loan, what recourse would the lender have? The trip is already taken and the money already spent. They would have to sue you to get the money back. The saying ‘you can’t squeeze blood from a stone’ may apply here.
However, under the other scenario, let’s say you default on the home loan (mortgage). The bank simply can take the house back and sell it, recouping their money. This is why lenders are more eager to lend money on real estates especially in an appreciating market. Having said that, if you have bad credit you still are more risky in the eyes of the lender so there are some problems with getting a mortgage.
Particularly in the United States, there are a large number of lenders who will lend to people with bad credit. They are the so called ‘sub prime lenders’. These are companies who are willing to take a risk on people with bad credit knowing that they can foreclose on the house if needed and recoup most if not all of there money.
This comes at a price for the borrower however. Typically your interest rate will be much higher if you borrow from one of these sub prime lenders.
So… are there bad credit manufactured home loans? Absolutely, but you must not let the lure of home ownership lead you into a bad financial decision. It is great to own a home but make sure the burden of higher interest rates does not lead you to further damage your credit or worse, lose your home. Improving your credit score and repairing your credit should be an high priority.
Bad Credit Manufactured Home Loans – The American Dream or Nightmare?
16-11-2009 by adminHome Loan Modification Myths – Modifying Loans Under Obama’s ‘Making Homes Affordable Plan’
05-10-2009 by admin
Home loan modification has recently become a hot topic in many American households. Though it was always possible to renegotiate the terms of a loan and have them adjusted by your lender, the process wasn’t commonly performed until the recent mortgage meltdown. Though modifications are becoming a lot more common now, there are still a lot of home loan modification myths surrounding the subject.
With the passage of the President’s new Making Home Affordable (MHA) plan, lenders now have a consistent set of steps to follow in the case of home loan modification. From March 4, 2009 until December 31, 2012 homeowners will be able to use the $75 billion Homeowner Stability Initiative to obtain home loan modifications.
Participating lenders are paid out monetary incentives for adjusting your loan, and those incentives often make a modified loan much more profitable than foreclosure or other alternatives. In this way, the MHA plan works to get 4 to 5 million Americans out of financial trouble and save their homes.
Surprisingly, though, there are a lot of misunderstandings and myths about the MHA plan. Many people mistakenly believe that the government is forcing lenders to participate in the plan. That is completely untrue. The MHA plan provides a consistent set of procedures for modifying loans and provides lenders with incentives to arrive at workable modifications, but it does not coerce lenders to do so.
The lender is advised to calculate whether the modified loan would be more profitable than foreclosure, and then to choose the more profitable option. The thing is, foreclosure is an awfully expensive, time-consuming, unprofitable affair for lenders anyway. Combined with the incentive payments provided under the MHA plan, lenders almost always decide that modification is a better alternative to foreclosure.
A second big misconception is that the Homeowner Stability Initiative money will be aiding speculators and house flippers. That is also completely untrue. To take advantage of loan modification under the MHA act, you must be the owner and the occupant of the home in question. Your home address is determined by a credit check. No vacant or condemned homes are allowed to participate in MHA loan modifications. Second homes and investment properties are also ineligible.
Of course there will be lots of home loan modification myths out there during this period of financial turmoil. The new MHA plan is new, and people are still learning how it works. Just get educated and make sure to get the facts about loan modification under the MHA plan.