Now there is help for you if you fall into this category. You will pay a higher interest rate and/or points for your loan, but at MMC we now have the flexibility to take into account the reasons for the problems you had in the past.

Why are the costs higher for a sub-prime loan?
A mortgage lender has to ensure that the loan amount is protected against the risk of default, and that translates into a higher interest rate for the borrower. The rate is considered "sub-prime" – because you do not receive the favorable terms of a prime rate. First, we will look at the way you have handled your bills over the past few years. If your record of late payments is 30 days late or less, this will generally not count against you. More serious are those problems that are over 30 days late, and they seriously lower your credit score and your ability to borrow.

Is a sub-prime loan a good option?
A sub-prime loan may be a good option for buying a home at today's prices or to put yourself in a position to improve your financial position going forward. Getting a mortgage loan now and maintaining a good payment record can help you get more favorable terms later on if you desire to refinance. You can build up equity in a home over time and then refinance and use the cash you get to pay off bills and clean up your credit for the future.

Important to remember!
You should consider a sub-prime loan as a short term option, for up to four years. This period gives you an opportunity to clean up your credit and qualify for a lower risk, lower interest rate loan. In addition obtaining a sub-prime loan will give you the opportunity to own your new home now, instead of waiting and hoping to qualify for a more expensive home in the future.