Can I get a loan with NO credit? - Yes! Many programs are available for people with no credit scores. Lets say you are the type of person that likes to pay cash for everything, and believe me there are plenty of people just like you out there. You go to your bank and they tell you they cant help you because you have no credit. Remember the old quote that says, "its better to have bad credit than no credit at all"? Well thats not true anymore, more and more lenders have programs that allow for non-traditional credit. If youve paid rent, insurance, electricity etc., and have paid on time for the past year, you can purchase your own home. The number of non-traditional trade lines you need varies by lender, but its generally three to four. Some lenders allow secondary stated income, and boarder income for qualifying purposes.However, there are also numerous lenders that more than willing to lend 100%
Alternative credit can be generated from cancelled checks or receipts of cash payments. When qualifying for mortgage financing, it will be necessary to have an average of twelve months of payment history to establish a payment record.
No Problem, no credit loans are available in many forms and fashions. The easiest no credit program generally has a 35% down payment and a higher than average interest rate. There are also lenders who will use utility bills, phone bills, and numerous other verifiable payments as credit worthy accounts. They will give your on time payments a credit worthy value to suite their needs. Often it is just a case of being able to verify that you pay your bills on time and having some form of down payment ranging from 10% to 35% of the property value.
No credit loans are certainly available. Granted they are at a bit higher of an interest rate. But these loans will get you in the home you want. Once you have had a few mortgage payments under your belt you will find you qualify for more traditional programs.
Besides showing proof of alternative credit through bills and canceled checks, you can call any of the companies you pay a monthly bill to and obtain a Letter of Good Standing, or a Good Credit Letter, each company has different names and formats for these types of letters. Simply call the customer service number and tell the person what you are looking for, a letter stating you have had an account with them for X number of years, and that you make payments on time every month.
As far as banks are concerned, a loan applicant with no credit history is not the same as one with a bad credit profile. A mortgage applicant with bad credit has demonstrated that he has a pattern of mismanaging his financial obligations. An applicant with no credit history simply means he has not used credit, which is not indicative of the applicant's willingness and ability or the lack thereof to meet his debt obligations.
origination fee - The origination fee is a fee that is paid to the bank or your loan broker for his or her services in originating the loan.
Origination fees are often built into the loan amount.
Most banks/brokers charge an Origination Fee. As the name implies, it is a fee necessary to make the loan happen. Some loan structures also call for Discount Points. Discount Points differ from Origination Fees in that Discount Points are used to buy down the interest rates, temporarily or permanently. Origination Fee and Discount Points are both items listed under lender-charges on the HUD-1 Settlement Statement.
Broker or loan origination fee is paid to the person handling your loan application. This fee can be a set price or can be stated as percentage of your loan amount. The origination fee can be located at the top of your good faith estimate and should be disclosed within 3 days after applying for a home loan.
Most points are paid to receive a lower interest rate from the lender/broker. The difference in savings over the life of the loan can make paying points a benifit to the borrower.
If you intend on staying in your home for an extended period of time, it may be worthwhile to pay additional points in order to obtain a lower interest rate.
Any significant changes in fees should be redisclosed in the final GFE.
Origination fees are charged by the lender or Broker and are expressed as a percentage of the loan amount. They must be disclosed on the Good Faith Estimate and on the final closing papers, commonly called the HUD.
An origination fee is charged by a lender for processing the loan, expressed as a percentage of the mortgage amount. It's normally one percent of the loan amount.
