9 Best Mortgage Lenders for Bad Credit of 2022


You may think that because you have bad credit buying a house is out of reach for you. But, there are plenty of trustworthy mortgage lenders with good offers willing to loan to people with poor credit.

So, you might just have to start packing sooner than you thought.

Best Mortgage Lenders for People with Bad Credit


Crediful’s rating
Visit Site

For flexible mortgage options with less stringent credit score requirements, check out LendingTree. The benefit here is that rather than serving as a direct lender, the LendingTree website aggregates multiple mortgage offers for you after filling out just a single application.

The process is completed entirely online, and you could potentially see up to five different offers from various mortgage lenders. From there, you can compare the interest rates and terms to see if any fit your needs.

LendingTree also offers mortgages from lenders that provide a broad range of home loan types. In addition to conventional loans, you can also access loans from the Federal Housing Administration (FHA loans) and VA loans. These not only come with lower credit requirements but also lower down payment requirements.

With an FHA loan, for example, you could qualify with a minimum credit score of just 580 and a 3.5% down payment on your new home’s purchase price. Even if your credit score is lower than 580, an FHA loan is still possible if you increase your down payment to 10%.

For multiple home loan options with a quick and easy application process, be sure to consider applying through LendingTree.

Read our full review of LendingTree


Crediful’s rating
Visit Site

CitiMortgage has a range of home loan products for people with various credit scores. One of the more unique things about CitiMortgage is that they take into account situations for nontraditional credit — such as always paying your rent or child support on time.

They only approve loans for houses in good shape, meaning all construction must be finished, the roof must be fine, and the windows intact. So no fixer-uppers, HGTV fans. Also, be aware that there is a $100 application fee and a separate origination fee, but this is by no means unheard of in the industry.

If you don’t have the ability to put much of a down payment down, CitiMortgage offers what they call a HomeRun loan program. This program allows you to only pay 3% down, and they don’t even require you to pay for private mortgage insurance.

So, a $200,000 house would only require you to put $6,000 down. To qualify, you can only make 80% or less than the average income in the neighborhood, but in low-income areas, it’s available to anyone who wants it.

CitiMortgage also offers a conventional loan geared toward those with low income and low credit scores. It comes with no mortgage insurance requirements and highly competitive rates.

Read our full review of CitiMortgage

Navy Federal

Crediful’s rating
Visit Site

Serving military members and their families, Navy Federal makes first-time home buyers their number one priority. They help would-be homeowners by offering a wide variety of loans. Some of their loans include:

  • Adjustable-rate mortgages
  • VA Loans
  • FHA Loans
  • Interest-only loans
  • 30-year and 15-year fixed-rate loans

Their standout loan is the HomeBuyers Choice. It’s a fixed interest rate 15 or 30-year loan with 100% financing and no mortgage insurance.

There is a 1.75% funding fee that you can get waived if you’re willing to pay a higher interest rate of 2.125% — a great option at closing if you need to save some cash.

Like CitiMortgage, Navy Federal evaluates a range of payments for borrowers with poor credit scores, such as rent, cell phone, and utility payments. There is no minimum credit score requirement for VA loans, but it’s 620 for others.

The only real downside is that some borrowers report that it takes longer to close on houses than other mortgage lenders.

This is not incompetency by any means. On the contrary, with such popular mortgage options, they likely have more volume to get through than other lenders.

Read our full review of Navy Federal

new home

Best Refinance Lenders for Borrowers with Bad Credit

For borrowers with bad credit scores who are considering refinancing their mortgages, we recommend Credible and Connexus.


Crediful’s rating
Visit Site

When considering Credible (NMLS #1681276) for your mortgage refinance, you can get prequalified in under three minutes. Plus, it’s a loan marketplace, so you can actually get three refinance offers to compare from different lenders.

Applying for a mortgage won’t harm your credit score during the prequalification process, so if you’re in the process of trying to repair your credit history, you won’t experience any setbacks.

Another differentiator for Credible is its mortgage refinancing process. They batch questions and documentation requests, so you’re not wasting your time answering the same things over and over again. It’s rare for a loan marketplace to provide great customer support during the process, making Credible a true standout in the industry.

Interested in a cash-out refinance? Credible makes it easy to tap into your home equity to put it to use elsewhere. Or you can do a limited cash-out refinance to cover things like closing costs and fees of refinancing or a home equity line of credit (HELOC).

Read our full review of Credible


Crediful’s rating
Visit Site

By no means just a refinancing company, Connexus is an all-around great credit union with nothing but positive feedback online. With a super strong and user-intuitive web presence, they’re easily one of the trailblazers for next-generation banking.

Connexus offers great mortgage rates for anyone, but they do something a little special regarding refinancing. Any homeowner can go to their website and fill out an online form detailing what they currently have.

After only two business days, a loan officer from Connexus Credit Union will call you to discuss every option available. They call this their “No-hassle mortgage comparison.”

If you’re worried about low credit scores, Connexus also considers alternative methods to determine your ability to repay a loan. This includes utility bills, rent, monthly cell phone payments, and child support.

Read our full review of Connexus

mother and daughter in tent

Best Mortgage Lenders for Customer Support

Decent customer support seems to be what companies struggle with the most these days. People want 24/7 support, but they don’t want to speak with robots. Two companies that have figured out how to meet customer expectations are HomeBridge and Network Capital.


Crediful’s rating
Visit Site

At HomeBridge, you can initiate your mortgage application online, where they have various home loan programs to choose from. You can also learn about the pros and cons of each loan and refinance option through their extensive library of educational content.

Where they really receive their accolades, however, is through their customer support. It’s not something they really boast about, but they are constantly tweaking the process of getting a loan or refinance more user-friendly.

Here’s how.

Each time a customer fills out a feedback survey, HomeBridge addresses any negative feedback as soon as possible so that every customer can walk away having had a good experience. Look for this kind of dedication elsewhere, and you’re going to have a tough time.

Most companies who perform customer feedback questionnaires analyze the results and ask themselves how to fix the problem moving forward. HomeBridge not only fixes the problem moving forward but will actually go back to the initial complaint and fix that specific issue, too.

Read our full review of HomeBridge

Network Capital Funding Mortgage

Crediful’s rating
Visit Site

Be advised: Network Capital does have its faults. For example, it only does business in the following states:

  • Alabama
  • Arkansas
  • Arizona
  • California
  • Colorado
  • Delaware
  • Florida
  • Illinois
  • Indiana
  • Iowa
  • Kansas
  • Kentucky
  • Louisiana
  • Maryland
  • Minnesota
  • New Jersey
  • New Mexico
  • New York
  • North Carolina
  • Ohio
  • Oklahoma
  • Oregon
  • Pennsylvania
  • Tennessee
  • Texas
  • Virginia
  • Washington
  • Washington, D.C.
  • Wisconsin

It also doesn’t have an online prequalification tool. So if you’re interested, you’ve got to go through the whole process to see if this mortgage lender is even interested in working with you.

Even with these complaints, we still love Network Capital. Why? They’re doing a lot of things right.

For starters, they don’t charge any lender fees.

Secondly, they offer support to you while you’re applying and want you to call and ask questions. Even if it’s just for a small question that will take them three seconds to answer, they want you to call.

Tri Nguyen, the founder, urges this because he believes that no matter how digital we become, everyone wants to hear a human’s voice during such an important life decision. So they are there to answer questions and help you gather documentation.

And they do this all before they even know if they want your business. But don’t worry: the minimum credit score they require is only 600.

Read our full review of Network Capital Funding

Best All-Around Mortgage Lenders for Borrowers with Bad Credit

Taking into account the entire user experience, there are two companies that stand out:

New American Funding

Crediful’s rating
Visit Site

New American Funding is just about everywhere and doing everything right. They have 150 branch locations across the U.S. (except New York and Hawaii) and have a solid web presence.

You can go through the entire application online, get rate quotes, and track your loan application status right from your computer. They also have a vast array of loan products.

Here’s a list of everything they offer:

  • Adjustable-rate loans (5/1, 7/1, 10/1)
  • Bank Statement Loans
  • Conventional and FHA Loans for Renovation
  • Fixed-rate Loans of 10, 15, 20, and 30 years
  • FHA loans, VA loans, and USDA loans
  • Loan refinancing
  • Manufactured home loans

Unlike other mortgage lenders, they still do everything old-school — they evaluate each application individually with (gasp!) a real live human. No algorithms here.

This means that even if you have a bad credit score, they’re going to go beyond the numbers and look at you holistically because they understand that all cultures handle money differently.

For example, Latinos tend to pull money from family members when making a large purchase and prefer cash to credit cards.

With a no-debt mindset, of course, you may have a low credit score, but that doesn’t mean you don’t know how to handle money.

New American understands that, for this type of lifestyle, there are ways to pull data to support whether a person would be a responsible homeowner that goes beyond what the three major credit bureaus consider.

Read our full review of New American Funding

Carrington Mortgage Services

Crediful’s rating
Visit Site

Unlike the other lenders, Carrington Mortgage Services seems to bend over backward to help people with bad credit become homeowners. They’re even willing to work with you if your FICO score is as low as 550.

Another thing about Carrington that some people consider a negative (but we think is positive) is that they require all homeowners to go through a mortgage education program before buying.

They do this to make sure all borrowers understand everything that revolves around a home loan so that they’ll be more likely to make better financial decisions in the future.

Carrington considers the typical factors that play into your credit score, like payment history and money owed. However, they also consider job history, job stability, gross income, and down payment size for approval.

Need assistance with a down payment?

Depending on where you live, Carrington may be able to help you. However, the program isn’t available nationwide because some states would require Carrington to sell the servicing rights to the associated loans if they helped with the down payment.

If they did this, it would impact their ability to work with low-income, bad credit borrowers.

It should come as no surprise that Carrington has a solid digital infrastructure, that their customer service is among the best of the best, and they offer competitive refinance rates.

The only cons we can come up with for this company is that it’s not in every state (Alaska, Massachusetts, North Dakota, and Vermont), and it can’t offer down payment assistance nationwide.

Bottom line: Carrington is awesome.

Read our full review of Carrington Mortgage Services

Tips for Applying for a Home Loan With Bad Credit

Many of the lenders listed in this article are ideal for borrowers with high credit scores. But if your credit score is lower than you would like, know that it’s still possible for you to qualify for a home loan.

Many lenders are willing to work with borrowers than have less-than-ideal credit scores. Here are five steps you can take to get started.

1. Take steps to begin improving your credit score

The first place to start is to request a free copy of your credit reports. Your credit reports will give you an idea of where you are currently and the steps you can take to improve your credit score.

Make sure you check your credit report for any inaccuracies or derogatory marks. You can request to have any incorrect information removed. And if you have any negative marks on your credit report, you can write your lender a goodwill letter and ask to have them removed as well.

The best way to improve your credit score is by paying down your credit card debt and making your monthly payments on time. These two areas account for the most significant portion of your FICO score, so just taking those two action steps alone should help your credit score.

2. Be realistic about what you can afford

If you don’t have good credit, you can still apply for a mortgage. But be very realistic about what you can afford with your current budget.

Since you have a low credit score, lenders will see you as more of a risk for defaulting on your mortgage, so you will have a higher interest rate. However, if you only request the maximum loan amount you need, you’ll have a better chance of getting approved for your loan.

3. Check out alternative loans

Borrowers with imperfect credit may qualify for a bad credit mortgage loan with alternative homebuyer programs. In particular, FHA loans are available to borrowers with credit scores as low as 580. But you will have to come up with a 3.5% down payment.

Veterans with bad credit should look into getting a VA loan. These loans don’t require any down payment and are easier to qualify for than traditional mortgages.

Finally, USDA loans are designed for low-income homebuyers in rural areas. They typically require a credit score of at least 640.

See also: 14 First-Time Homebuyer Grants and Programs for 2022

4. Save up for a sizable down payment

If you want to increase your odds of approval, then it’s a good idea to save up for a sizable down payment. At least 20% is ideal and will also save you from having to take out private mortgage insurance (PMI).

Coming up with a down payment won’t entirely compensate for a poor credit score, but it could help you make your case with some lenders.

5. Consider applying with a qualified cosigner

And finally, you can look into applying with a qualified cosigner. When you apply with a cosigner, that person agrees to take legal responsibility and repay the loan if you can’t. And since that person’s credit score is tied to the loan as well, it increases your odds of approval.

However, cosigning a loan is a risky move, so you should only ask someone to do this if you’re confident you can make your mortgage payments. Otherwise, you’re putting that individual’s financial future at risk.

Meet the author