Bad Credit Home Loans - Sub Prime Mortgages

Sub prime mortgages are home loans which are specially designed to allow people with past credit problems a chance to purchase a home. Under typical circumstances, harsh activity on your credit report, such as a recent foreclosure, will make it nearly impossible for you to get approved for a home loan. But less serious credit discrepancies may not stop you from getting approved.

Generally speaking, sub prime mortgages are meant for applicants with a credit score of 620 or less.

Conventional mortgages are usually for people with decent-to-excellent credit, and rates for good-credit borrowers are pretty similar from lender to lender for a similar product. With sub prime mortgages, it is very likely that you can be offered a loan with a rate and terms that differ hugely from the lending institution down the street. Each lender may have a different fashion in which they weigh risk. If your credit score is 580, one lender may consider you an enormous risk and your interest rate will be through the roof, while another lender may think that 580 isn't nearly as risky. It is wise to shop around when it comes to sub prime mortgages.