Yes You Can Buy a House If You Have Poor Credit. EVENTUALLY
Several months ago, I received an email from a young lady that had a question about a home that I had for sale. Her credit was a bit shaky (by her own admission) and she wanted to know if it would be possible to buy a home if her credit was not good. She really wanted to buy a house, but she wanted to see if a lease purchase was available because she thought it would take too long to get her credit up to par. My response to her is below:
I'm no loan officer. I'm a real estate agent. But this is what I can tell you about buying a house if you have bad credit: Bad credit does not have to be forever.
Years ago as a young adult, I did not fully grasp the TRUE value of maintaining good credit. But when I finally realized that having poor credit was like being a second class citizen, I got serious about cleaning it up so here's what I did:
First I ordered my credit report from TransUnion. Looking back, had I known better, I probably would have ordered one from all three credit bureaus including Experian and Equifax).
Second, once I received my credit report, I thoroughly reviewed it for inaccuracies, but mostly I was looking for accurate info that I could cure over time.
For inaccurate information, I wrote a letter to the credit bureau and disputed the information. I asked that it be investigated and I requested that they update any inaccurate information and send me an updated credit report to reflect their findings. Much to my surprise, when I got a copy of the updated report, some derogatory information had been completely removed. I think from that point on, I knew I could be in control of my credit health.
Finally, I taped my updated credit report on a wall in my closet so that every time I walked into my closet, my credit report would be the first thing that I laid eyes on.
I then targeted one derogatory item at a time that I wanted to work on until that negative info become a positive. For example, if I had bad debt of of say $800, I would work on paying that or make arrangements to settle for a reduced amount. After the debt was paid, I would write the credit bureau notifying them that the debt had been paid in full and I asked them to verify it, update my credit report and send me and updated copy.
One by one, I eliminated every bad credit entry and watched as each targeted item was literally scratched off of my list. I will never forget what a tremendous sense of accomplishment that I felt when I scratched off the last item that needed to be cured. I had completely turned my my bad credit onto good.
It probably took me about 3 years (4 at most) but the time went by so fast, it didn't seem like such a long time at all. Of course I had to give up some things. For example instead of buying those shoes that I would have died for, I used that money to pay for a debt. And you know what? My feet didn't miss those shoes at all.
So if you are thinking that you cannot by a house because you have bad credit then you're wrong. Just because you have bad credit doesn't mean it has to stay that way. But you've got to want it and you have to be committed to the process of cleaning up your credit act.