Getting Bad Credit Mortgage Loans Online Provide the Best Terms

For every individual applicant, there is a credit score that affects the approval rates amongst loan applications. This is commonly known as a FICO score, named after the Fair Isaac Corporation, that compiles it. The good news is that by knowing their own FICO credit score, applicants can better prepare when applying for bad credit mortgage loans online.The score has a number of other significances associated with applications, not least the fact that they are used to set the interest rate on the loan. But though this is unavoidable to most traditional lenders, online mortgages approved with bad credit are a different story. This is because most online lenders ignore these scores.Lenders online specialize in loans structured specifically for applicants with bad credit scores, offer lower interest rates that traditional lenders do. So even with bad credit, online approval for bad credit mortgages is much less difficult to attain. Still, knowing the significance of your FICO score is important. Here is how.Credit Scores Below 599If the FICO credit score is between 585 and 599, then the borrower needs to make a down payment on the property to help their application, usually around 5%. An applicant with credit score of below 585, meanwhile, should make a down payment of between 10% and 20%. In both situations the applicant should consider applying to a sub prime mortgage lender who specializes in bad credit mortgage loans online.This kind of lender also specializes in loan products for people with other financial problems, independent of their bad credit score. Having a lender specializing in such matters is highly beneficial, offering more flexible terms and higher rates of online approval for bad credit mortgages.Finding online mortgages approved with bad credit with such a low credit score is very possible, though the lender will offset the perceived risks to ensure a profit is made.Credit Scores of 600 and AboveHaving a FICO credit score of between 600 and 620 would most likely see the applicant qualify for 100% finance, though the applicant must still find sub prime mortgage lender. However, for applicant seeking bad credit mortgage loans online, finding such a lender with good terms is much less difficult than those with an even lower credit score.But, on the other hand, having a credit score above 620 not only qualifies the applicant for 100% finance but also for a lower interest rate of just 1 or 2 points above the prime rate. Having such a credit score should not make a sub prime mortgage lender necessary, but they do make online approval for bad credit mortgages more likely.It is worth noting that having a FICO credit score of 620 or above will see some traditional lenders more lenient in their assessment and approve the bad credit loan. Still, it is statistically more likely to get online mortgages approved with bad credit with this score.Facing Bankrupcy or ForeclosureIt is only logical to think that bankruptcy or a foreclosure would mean little hope of a successful application. But this is not necessarily the case when seeking a bad credit mortgage loan online. Bankruptcy is a serious matter, certainly, but it too is not a killer blow to hopes of getting online approval for bad credit mortgages.After two years, applicants who have suffered with bankrupcy, repossession or foreclosure, have a good chance of getting a loans. This is because the applicant is likely to have seen an improvement in his financial situation. So even online mortgages appoved with bad credit become much easier.After 3 years, even if an applicant still has an extremely low FICO credit score and is seeking a bad credit mortgage loans online, the chances of success are higher again.