All lenders regardless of where they are require verifying a borrower’s credit worthiness before they are ready to extend a loan. So if one wants to apply for a mortgage loan one needs to know if they qualify for a mortgage loan and what is their credit score. In USA Fair Isaac Corporation developed the method of credit scoring which is commonly referred to FICO score. This is the score that is used in the USA for getting a mortgage loan. The credit score range is from 300-850 and the higher the score the better are the chances of getting a mortgage loan. Some mortgage companies will give a 100% mortgage loan if the credit score is above 620 and some will give a 125% loan if the credit score is over 740. On the other side the lower the credit score is the lower will be loan amount that is offered. Having a bad credit score does not mean that people get automatically disqualified from getting a mortgage loan it is just that the loan amount will be lower and one will have to come up with a down payment and will also be required to take out insurance.

Some mortgage companies deal with bad credit mortgage loans as mortgage companies also know that the percentage of people with perfect credit scores is a small percentage of the total population and if they restrict themselves to only entertaining people with high credit scores they would not get much business. People do slip up on making some payments due to an oversight or that they did not have sufficient funds to make a repayment or just did not make payments that were due on the dates that they were due. This does affect the credit score however it does not imply that a person cannot get a mortgage loan.

Most mortgage companies do advertise that they handle ‘bad credit mortgage loan’ and ‘bad credit mortgage refinance’. Having a bad credit score will mean that the mortgage amount that one can get will be less then that with a good credit score and the interest rates and other costs will be higher. Some banks and mortgage companies use their own method of calculating a credit score and this may be different from FICO.

If one wants to get a mortgage one should first get their credit score and should state the purpose for which they want the credit score as the credit score for a car loan is worked out different from getting a mortgage loan. If one has a mortgage loan bad credit rating then before applying for a mortgage loan look around at what different mortgage companies are offering as loans to people with a bad credit score.

During the repayments of a mortgage one may go into bad credit and default on mortgage payments and if one has a mortgage bad credit history then one may not be able to get another mortgage. Mortgage companies that offer second mortgages will not only take into account a person’s credit history but will also check with the company from which the first mortgage was taken the person’s repayment history. To get a bad credit home mortgage loan is not impossible as mortgage companies do not turn away people with bad credit. It is only those people who are denied mortgage loans who have a very bad credit score. in the USA having a credit score of less then 500 is termed as a bad credit score and most reputed mortgage companies will not entertain applications fro people whose credit score is less then this.

Having a mortgage bad credit history will stop mortgage companies from offering a second mortgage or refinancing. In UK and Canada credit score are used to evaluate a person’s credit worthiness before they extend a mortgage loan and there also the lower a person’s credit worthiness is, the fewer are the chances of getting a favorable mortgage loan.