Are you worried that you might not be able to get a construction loan because you have had a bad credit history? Defaulting on your payments and filing for bankruptcy will not forever blacklist you from construction loan lenders for bad credit. There is hope if you know where to find it.
Low credit score construction loans
can be possible if you start cleaning up your credit report the soonest possible time. You may want to get a copy of your credit report and try to see which debts are ending soon and you pay it off as soon as possible. If you filed for bankruptcy in recent years, try to see when its life cycle in your credit report will end so that it doesn’t show anymore. If it will be over in a couple of months, you may want to delay your application to make sure that your credit report is now clean.
One of the construction loans that can be an option is for you to take out an FHA loan. You may want to talk to your loan officer to get an updated score requirement
because even if the FHA minimum stays the same, there are FHA mortgage lenders who increased their FICO score requirements because of the COVID-19 pandemic. What you know last month, may not be applicable today.
Low credit construction loans
can also be availed if you are a veteran as part of the benefit of being a military serving the country. Usually, as a borrower, you need to have a FICO score of at least 660 but VA loan lenders can go down below the minimum. Again it is always best to consult a loan officer because they are experienced in the field and can give you ideas on how not to only improve your credit score but they can also tell you the different kinds of loans that can be applied for by borrowers with low credit scores.