Srfugettlpn, Renter in

What are the options for someone with negative credit rating to rent or purchase?

Asked by Srfugettlpn, Mon Oct 24, 2011

Medical bills, student loans have negatively affected my credit score. I am working to fix it but what are my options in the meantime?

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Hi,
first of all I would suggest holding off buying until you get your debts paid off. When applying for a rental property and the landlord/property manager says they run a credit check, ask if they require a minimum FICO score or debt/income ratio. If they do and yours don't meet their minimum standards, you could offer to pay the last month's rent up front. For good advice on getting and staying out of debt, visit http://www.daveramsey.com.
Best of luck to you!
Sue Bigus
Web Reference: http://www.SueBigus.com
1 vote Thank Flag Link Mon Oct 24, 2011
The best suggestion is to talk with a good mortgage lender to find out what you can buy and when. You don't know what you don't know. I can give you some excellent people to talk with. Once you find that out, you can make a good decision on whether it's time to rent or buy. I always tell potential buyers I work with that everyone can buy a home, it's just a matter of when. I work with a lot of buyers and can give you more info if you would like to contact me.
2 votes Thank Flag Link Mon Oct 24, 2011
Don't pay extra fees for insurance or hire a lender to fix your debts. Most property management companies will listen to your issue. As long as you have a good logic, you can overcome your credit concerns. We are mostly concerned about felonies and evictions and bills you volunteered for, like car loans and rent. Medical injuries happen, and bills follow, but you don't decide when. The best solution is good communication and a logical plan.
1 vote Thank Flag Link Mon Oct 24, 2011
Some property management companies offer a type of rental default insurance for the landlord to accept as coverage in the event of default on a rental lease. There is typically an upfront fee ($300-$500 estimate) and then ($30-$100) a month. The landlord may feel comfortable enough with this coverage to accept your less than perfect credit. Our property management company does use a company that offers this coverage.
1 vote Thank Flag Link Mon Oct 24, 2011
Hey Srfugettlpn,

If your FICO score is below a 580, most likely you'll need to rent until you can get to that point or higher.

If you have had a lot of collection agencies coming after you , then you may have some problems even renting.You will probably have better chances renting directly from a property owner than a property management company.

A good lender can help you work on your credit, and direct you on which way to go.

Call me at 719-233-7733 if you have any questions.

Thanks
Ralph Lechner
Re/Max Properties
1 vote Thank Flag Link Mon Oct 24, 2011
You would be a perfect candidate for a lease option/ lease purchase/rent to own program.

These programs typically work with people who have dinged credit but would like to get into a house for long term rather than continue renting. A lease option essentially works like this: the tenant buyer (renter who wants to purchase the property) signs a lease with an option to buy the property within two years. During the lease period the tenant buyer works towards improving their score so that they can qualify for a loan at the end of the two year period.

There are a lot more details to a lease option/lease purchase/rent to own program and they vary by company. If you choose to go this route, make sure you do adequate research to protect yourself, your money and your option to buy the house. Also make sure that the company you choose to use is reputable.

Attached my company site with more information on lease options. We are specialists in this method of buying in Colorado Springs.

I hope this is helpful to you!
0 votes Thank Flag Link Tue Oct 25, 2011
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