Bad Credit?
We Can Help.
A low credit score does not have to stand between you and homeownership. Theós Financial works with lenders who specialize in credit-challenged borrowers, and we offer strategies to help you improve your score and qualify for better rates.
Last updated: March 2026
Bad Credit Does Not Mean
No Mortgage
Life happens. Medical bills, job loss, divorce, unexpected expenses — there are countless reasons why good people end up with less-than-perfect credit. If you have been turned down by a bank or told your credit score is too low, do not give up. There are real options available to you.
At Theós Financial, we believe everyone deserves the opportunity to own a home. As a mortgage broker with access to over 200 wholesale lenders, we work with institutions that specialize in lending to borrowers with credit challenges. Many of these programs are not available at traditional banks — they are wholesale-only products that require a broker to access.
We have helped borrowers with credit scores in the 500s achieve homeownership. We have helped people who went through bankruptcy, foreclosure, or short sales get back into a home sooner than they thought possible. And we have helped many clients improve their credit score before applying, so they qualify for better rates and terms.
Your past does not define your future. Let us show you what is possible.
Options at Every
Credit Level
Different loan programs have different credit requirements. Here is what may be available to you based on your current credit score.
Credit Score 620+
At 620 and above, you qualify for most conventional loan programs. You will have access to competitive rates, low down payment options (as low as 3%), and a wide selection of lenders. This is the sweet spot for the best conventional terms.
- Conventional loans available
- Best rates and terms
- 3% down payment options
Credit Score 580-619
FHA loans are available at 580 with just 3.5% down. This is the most popular program for borrowers rebuilding credit. FHA guidelines are more forgiving of past credit events like collections, late payments, and even some bankruptcies.
- FHA loans with 3.5% down
- Flexible credit guidelines
- Gift funds allowed
- Manual underwriting available
Credit Score 500-579
FHA loans are still available at scores as low as 500, though a 10% down payment is required. Non-QM lenders also offer programs in this range with alternative documentation. While rates are higher, homeownership is still within reach.
- FHA with 10% down
- Non-QM programs available
- Bank statement loans possible
How to Improve Your
Credit Score
Even small improvements to your credit score can result in significantly better mortgage rates. Here are proven strategies that can raise your score quickly.
Pay Down Credit Card Balances
Credit utilization — the percentage of your available credit that you are using — is one of the biggest factors in your credit score. Paying your credit card balances down to 30% or less of your limit can produce a significant score increase, sometimes within a single billing cycle. Ideally, aim for under 10% utilization for maximum impact.
Dispute Errors on Your Credit Report
Studies show that roughly one in four credit reports contain errors. Pull your reports from all three bureaus (Equifax, Experian, TransUnion) and review them carefully. Dispute any inaccurate accounts, wrong balances, or items that do not belong to you. Removing errors can produce immediate score improvements.
Become an Authorized User
If a family member has a credit card with a long history and low balance, ask to be added as an authorized user. Their positive payment history can appear on your credit report and potentially boost your score. This is one of the fastest legitimate credit-building strategies available.
Avoid New Credit Applications
Every new credit application results in a hard inquiry on your credit report, which can temporarily lower your score. In the months leading up to a mortgage application, avoid applying for new credit cards, auto loans, or other financing. Wait until after your mortgage closes.
Make All Payments On Time
Payment history is the single most important factor in your credit score, accounting for roughly 35% of the total. Make every payment — mortgage, auto loan, credit card, utility, everything — on time, every time. Even one 30-day late payment can cause a significant drop in your score.
Negotiate Collections & Settle Debts
If you have accounts in collections, contact the collection agency and negotiate a pay-for-delete agreement. Many collectors will remove the negative item from your credit report in exchange for payment. Even paying a collection without deletion can help in some scoring models.
Buying After Bankruptcy,
Foreclosure, or Short Sale
If you have been through a major credit event like bankruptcy, foreclosure, or short sale, you may think homeownership is years away. The reality is more encouraging than you might expect. Here are the typical waiting periods for different loan programs:
- Chapter 7 Bankruptcy: 2 years for FHA, 4 years for conventional
- Chapter 13 Bankruptcy: 1 year into repayment plan for FHA (with court approval)
- Foreclosure: 3 years for FHA, 7 years for conventional
- Short Sale: 3 years for FHA, 4 years for conventional (with extenuating circumstances, may be sooner)
- Non-QM Lenders: Some lenders have no waiting period at all — available immediately with sufficient down payment
As a mortgage broker, Theós Financial has access to lenders with varying seasoning requirements. In some cases, we can find a solution even before the standard waiting period has elapsed. Every situation is different — contact us to discuss your specific circumstances.
Our Approach to
Credit-Challenged Borrowers
Free Credit Analysis
We start by pulling your credit report and analyzing it thoroughly. We identify areas where improvements can be made quickly and develop a personalized action plan to maximize your score before you apply.
Rapid Rescore Programs
In some cases, we can use rapid rescoring to update your credit score within days — not the typical 30 to 45 days. This is particularly useful when you are close to a qualifying threshold and need a quick boost.
Non-Traditional Lender Access
As a broker, we have access to non-QM and non-traditional lenders who look beyond credit scores. These lenders consider your overall financial picture — bank statements, assets, employment history, and rental history — to make approval decisions.
Your Credit Score
Is Not Your Destiny
Whether you are ready to apply now or need help improving your credit first, Theós Financial is here for you. Contact us for a free, confidential consultation.