Dear EchoBay Expert:

Dear Loyal Reader: There are many lenders who specialize in bad credit home loans. A quick search online will generate hundreds of results. While your FICO score would put you in a bad debt category, it should be noted that some lenders will overlook unpaid medical bills.

This is not the case with every one. The only reason this is overlooked is because it is not debt you willingly took on for yourself. If you needed emergency surgery, you really did not have the option to decline because you couldn't afford it and a doctor cannot ethically refuse to provide it because you can't pay.

Because of this, some lenders are more lenient with these types of accounts on your credit report. Rest assured there are lenders out there for your situation. You can expect to pay a higher interest rate with a bad credit loan and you may have to pay more in closing costs.

If you have a down payment or can prove timely payments for the past year, this can help you get a better deal with your lender. You should avoid applying with banks as they typically only deal with excellent credit customers. Inquiries on your credit report will only aid in driving your score down further.

Be sure to seek out lenders who specialize in bad credit home loans. A great place to start is online as you can find many with just the click of your mouse. These lenders can offer the most assistance to you and be sure your home ownership dreams become a reality.

Dear EchoBay Expert:

Dear Loyal Reader: Don't worry, you're in good company. A good percentage of consumers have suffered some dings in their credit histories, and it's not going to blackball you from getting a house. It's even possible that the guy who told you that "they don't lend to high risk individuals" probably wouldn't qualify for a loan with the institution he works for.

The first step to getting approved for a home loan with bad credit is to get your hands on a copy of your credit report. Review the information and make sure that everything is accurate and up to date. If you have any outstanding collection accounts, get them paid off and try to pay down your debts.

Once your credit report reflects accurate information, it's time to apply for your home loan. Just remember, it's important to work with a lender that specializes in credit risks. They'll be more likely to approve you than the bank down the road who only wants to lend to "A" credit customers.

Also try to have some money set aside for a down payment. When a lender sees you're willing to put your own cash on the line, they're more likely to add in theirs.