Q:

How can you obtain a mortgage with no credit check?

A:

Quick Answer

Most major banks and mortgage lenders require an extensive credit check before they offer mortgage financing, according to Gigi Starr for SFGate. However, no credit check or low credit score requirement mortgages do exist through outlets such as local credit unions, smaller banks or seller-carryback financing.

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Full Answer

Seller-carryback financing is a popular way to obtain mortgage loans if homebuyers cannot qualify for traditional loan programs using banks and finance companies, states Colin Robertson for TheTruthAboutMortgage.com. The buyer and seller of a home negotiate all the terms associated with the seller-carryback mortgage loan, and then the seller, not a bank, carries the mortgage loan. Interest rates, credit checks, down payment requirements and loan amounts are between buyers and sellers. Banks and mortgage companies have no say in the terms of the seller-carryback financing.

Although some credit unions and smaller banks offer no-credit-check mortgages, mortgage loan applicants must be customers for many years, explains Mortgage101.com. Local credit unions are nonprofit organizations that do not operate like traditional banks. They do not offer subprime or exotic mortgages, and the income requirements are far less stringent than traditional banks and mortgage lenders. However, no-credit-check mortgages usually carry much higher interest rates and strict down payment requirements than traditional mortgage financing.

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