MCP Help Blog

If you have bad credit, just hope you don’t live in California, Florida, Arizona, Michigan,  or Nevada. Major lenders are piling on the poor people who own homes in these states, requiring higher credit scores and charging more to lend in these designated “distressed” areas. On Monday, one of the largest American banks is joining in the beatdown of distressed states. 

What makes an area distressed in the first place? A housing market with falling values, that’s what. And by making it harder to finance in these states, aren’t lenders making things even worse? How can distressed real estate markets make a comeback if buyers have a hard time getting loans there? Wasn’t this what TARP funds were for–lending?

Once again, lenders are at cross purposes with the public interest–and as long as there is no stick to go with the nice carrots the taxpayers keep feeding them, nothing will change. What can you do? If you have a bad credit history, or even just an okay credit history, you are really going to have to shop around for your next mortgage. Make sure that the lender you choose works in your state and doesn’t impose extra fees because of where your property is. Shopping online is probably your easiest route to multiple offers and quick comparisons. Good luck!