Buying a home typically requires getting a mortgage—and rest assured, lenders prefer lending money to people with a proven track record paying off debts. The reason: This bodes well that they’ll get their cash back, too. That’s why lenders check your credit score, which sums up how well you’ve handled your credit cards, college loans, and other financial obligations.
A good credit score means you’ll get a great mortgage. A bad credit score means you’re in trouble, but not that you should just throw in the towel. Check out this crash course on how to buy a home with lousy credit. Yes, it can be done.
What is a bad credit score, anyway?
First things first: While you may have a vague sense your credit score is bad, that’s not enough. How bad is it, really? Ideally, you should check your credit report long before meeting with a mortgage lender. Your credit score is based on the information that appears on this report, and you’re entitled to a free copy of your report from each of the three major credit bureaus (Equifax, Experian, and TransUnion) at AnnualCreditReport.com.