Whether you are looking to repair your home or supplement your income during retirement, a reverse mortgage loan can help. However, there will be some extra steps you need to take when getting a reverse mortgage, which will make the process similar to applying for a traditional loan. A crucial part of qualifying for a loan is the assessment of the credit history of the borrower.
Reviewing Your Credit History
Your lender would assess your credit history as part of the financial evaluation and will need a credit report in order to document that history for all the borrowers.
However, not having a satisfactory credit doesn’t necessarily mean that your loan application will be declined. That rule was made by the Department of Housing and Urban Development.
If you have unsatisfactory credit, lenders should do further analysis of your other accounts to find out why you made late payments or why you had overdue accounts as well as the possible reasons that may have caused them.
The lender will determine that you have satisfactory credit if you made all the payments on time for the past 12 months and if you have no major derogatory credit on your revolving accounts over the past year.
Reverse mortgage Myrtle Beach need an overall good credit history without any late payments over the past 24 months for charges that are related to property like mortgages, insurance, and taxes. This will help you get approved for a loan and also to avoid setting certain funds aside to pay insurance and taxes on the loan down the road.
What If I Have Bad Credit?
You can still get a reverse mortgage loan even if you have a bad credit. But this will depend on the credit. Most credit would eventually require an approval on a refinance however, when your credit isn’t in good standing over the last 24 months, you might need to set some money aside out of your loan to pay the insurance and the taxes. You can also be declined if you have a bad credit but that is uncommon.
What If I Filed For Bankruptcy?
You can still apply for a reverse mortgage loan even if you have previously filed for bankruptcy in the past. How long you could do the loan will depend on if the loan is a refinance or purchase.
Will A Reverse Mortgage Loan Show Up On My Credit Report?
Reverse mortgages don’t require you to make payments and that means most lenders don’t report this type of loan to credit agencies.
Does A Reverse Mortgage Loan Affect My Credit Score?
The reverse mortgage loan won’t affect your credit score but if you use the proceeds to pay off your debts, this positive improvement in your profile would improve your credit score, too.
Call Reverse Mortgage Specialist if you want to know more about reverse mortgage and how it would affect your credit history.
Reverse Mortgage Specialist
1293 Professional Drive, Suite 204
Myrtle Beach, SC 29577