The Pros and Cons of No Credit Check Mortgage Loans

Are you in thinking about purchasing a home? Is your credit slowing down or stopping the process? Have you been considering taking out a no credit check mortgage loan? If you answered yes to these questions, be sure to keep reading. These types of loans may sound appealing, but they can carry severe penalties, Annual Percentage Rates (APRs), and high fees. Therefore, below you will find the pros and cons for these types of mortgage loans.

First, the Pros

As any home owner will tell you, getting the financing on a new home is the most nerve racking event next to a birth. You have to fill out miles of paperwork, only to hope your credit is good enough to get the loan. Well, for many hard working individuals in the U.S., credit is the sole reason he or she cannot get the hoe of their dreams. If their credit is considered poor, traditional lenders will turn them down, even if they have the down payment and can afford the monthly payments. Does this sound like your situation? You are not alone. Here are several reasons to consider a no credit check mortgage loan.

  • Almost anyone can be approved
  • Your credit score does not matter
  • If you have the money and the collateral, you get the loan
  • The process is fairly quick
  • You can be self-employed and still be approved

Now, the Cons

Of course, you cannot expect to get something for nothing, and these types of lenders operate in the same manner as no credit check payday loan companies. In other words, you can expect a high APR on your loan. There are several cons associated with these loans and some of the top reasons to reconsider are as follows.

  • Astronomical APR with some well over 400 percent
  • The fees are very high, such as administration fees and filing fees
  • There is usually no grace period in repaying the loan as with a traditional lender
  • The down payment is going to be higher than a regular mortgage loan
  • You will end up paying out far more for the loan than with a traditional mortgage

As you can see, this is not a decision that should be rushed into, no matter how anxious you are at purchase a new home for you and your family. There are considerable drawbacks as well as pluses involved. Just do your research, so you can make an informed decision.