Getting a bad credit mortgage is easier to get then you might think. If your credit score is as low as 600 you may still be able to qualify. You will still pay a higher interest rate than you would if you had perfect credit but with the current interest rates as low as they are you will still get a pretty sweet deal.
If you have known for a while that you have wanted to buy a house and have planned well and now have a down payment in place, you will have an easier time of convincing the bank that you are not as much of a risk as they might have originally thought.
Having a down payment of up to 20% of the list price of the house will definitely improve your chances of getting approved for that bad credit mortgage and might just chop a couple of points off the interest the bank was thinking of charging you.
If the bank does not have to loan out 100% of the list price of the house they will probably approve you without even blinking and eye. If they only have to loan out 80% of the price of the house then should you happen to run into trouble and they have to foreclose they will have a better chance of recovering some, if not all, of their money.
Conversely if they loan you 100% of the list price of the house they take a big risk of losing it all if and when they have to foreclose on you. So, come up with up to 20% and the bank will love you long time.
Just telling the people at the bank that you are a responsible person will not cut it. You will have to prove it. How? Well, how long have you been working at your job? Have you had a long standing relationship with the bank you are working with and they can see by your records that you have been good with your money and not incurred a lot of overdraft fees and such? Have you lived in the area a long time? All of these things can help when applying for a loan.
If the bank sees that you have been at your job for years and have not changed jobs every year or so they will feel more confident that you are what is called "a good risk".
Also, if you had a short time when things were rough and your credit score suffered a bit and can offer up a reasonable explanation to the bank about what happened the people at the bank may soften a bit and accept your lower score more readily and give you a decent deal on your interest rate.
Just know that there are ways around a low credit score and you can find a way to buy the house you want and get a decent deal on a bad credit mortgage from the bank.