How to Buy a House with Bad Credit

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There is no question that buying a home is one of the biggest investments you will ever make in your life.  If you have bad credit and are wondering how to buy a home in the Houston real estate market, don’t worry — there are still plenty of ways to make your dream a reality. Keep reading for our tips on how to buy a home with bad credit.



signs that says good credit to the right and bad credit to the left direction

Check your credit score and credit report

The first step to take when you’re trying to buy a home in Houston real estate market with bad credit is to check your credit score and credit report. This will give you an idea of where your credit stands and what lenders will be looking at when they consider your loan application. You can get your free annual credit report from each of the three major credit reporting agencies — Experian, Equifax, and TransUnion — at


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Get pre-approved for a mortgage

Once you know where your credit stands, the next step is to get pre-approved for a mortgage. This means that you will have a better idea of how much money you can borrow and what interest rate you can expect to pay. It’s important to compare offers from multiple lenders so that you can find the best deal possible.


a couple dealing with a realtor

Find a good real estate agent who can help you find a home within your budget

If you’re not sure where to start your home search, working with a good real estate agent Houston can be a huge help. A good agent will understand your credit situation and budget constraints and will be able to help you find a suitable home. They’ll also be able to negotiate on your behalf and help you navigate the home-buying process.


a hand holding a house-shaped paper with a text down payment

Save on a larger downpayment

Because it is risky to lend money to someone with bad credit, mortgage lenders are reluctant to approve them. If you put down a substantial amount, a lender might consider you for a mortgage.

A higher down payment means a lower loan-to-value ratio. If your mortgage loan is less than your home’s value, it is less likely that you will go underwater. Because it gives them greater protection in the event of your defaulting on payments, lenders prefer a low loan-to-value ratio. They know that if they have to repossess the home, they will be able to sell it and recover the entire loan amount.

If you are trying to get approved for a mortgage, with bad credit, you may need to spend more time saving up for a downpayment. However, there are many benefits to having a large downpayment. You will pay less monthly and may even get a lower interest rate.

It can be hard to purchase a home if you have a bad credit score. It is essential to do all you can to improve your credit score and save a substantial down payment. This will increase your chances of getting approval. Even if your credit is not perfect, you may be approved for a modest starter home. You can then work on improving your credit score to make your next encounter with a lender easier.


If you’re looking to buy a home in Houston real estate market, it’s important to check your credit score and credit report first. You don’t want any surprises when it comes time to apply for a mortgage. Getting pre-approved for a mortgage is also a good idea; this will help you know how much you can afford. Once you have an idea of what you can afford, start searching for homes in your price range and save on a larger downpayment. When you find the one you want, submit an offer to the seller. If they accept, start negotiating with them to get the best deal possible. Buying a home doesn’t have to be stressful; follow these tips and you’ll be on your way to homeownership in no time!

Aurhomes Group is a real estate agent Houston that specializes in helping people buy homes in Houston real estate market. We have a team of experienced real estate agents who will work with you to find a home that fits your budget and needs. Contact us today to learn more about our services!