Bad credit won’t keep you from the home equity loan you need. Find companies that can help you get matched with lenders.
Check out the answers to these frequently asked questions to gain a better understanding of bad credit home loans in general. Determine which type of home equity mortgage is right for you, then fill out our no-hassle, no-obligation application to receive a free quote.
The online application process is quick and convenient. It is also secure, thanks to modern encryption methods. Your personal information is completely safe and will not be shared or sold. It will only be used to give you a competitive quote on a home equity mortgage.
What is a bad credit home equity mortgage?
Equity is “the residual value of a business or property beyond any mortgages, liens or other liabilities.” A bad credit mortgage allows you to use the equity in your home as collateral to secure cash in the form of a loan. A bad credit mortgage will have a higher interest rate than a prime rate loan, but the interest will still be lower than on other types of borrowing. And, it may be tax deductible.
What are the different types of mortgages?
Bad credit will not disqualify you from any of the three types of home equity mortgages:
· Fixed rate mortgages – A loan with a fixed rate that involves a second lien on your house.
· Adjustable rate mortgages – The interest varies according to the index upon which it is based.
· Combination rate mortgages – Starts with fixed payments, followed by an adjustable interest rate phase.
Which is the best loan for my situation?
Fixed rate loan:
A good choice when you have big-ticket items to pay for like major home improvements or debt consolidation. A term loan that involves a second lien on your house.
Adjustable rate loan:
A good option if you’re planning to stay in your house for less than five years. A term loan that involves a second lien on your house.
Combination rate loan:
A good choice if you want to start your mortgage with lower, fixed monthly payments—for up to three years. Sometimes, a combination rate loan will allow you to borrow more.
How do I get a new loan if I have a bad credit history?
Do you have money problems? Have you filed for bankruptcy? Made poor financial decisions that have resulted in a low FICO score? One way to repair your credit is to put the equity in your house to work for you.
What are subprime loans and who needs them?
Many banks and other financial institutions offer what are known as “subprime loans.” These make it possible for people with bad credit to get mortgages or car loans. Here are a few things to know about three types of subprime loans:
· Mortgage refinancing …
· Second mortgages …
· Debt consolidation loans …
How widespread is subprime financing?
Poor credit is a problem that plagues about 30 million Americans. For many of us, subprime financing is our best chance for getting a mortgage, a debt consolidation loan or an auto loan. We can still get competitive interest rates even if we have a low FICO score.
Home equity loans vs. lines of credit
Home equity loans come in two types: fixed-amount loans, which work like second mortgages, and lines of credit, which work like credit cards. …
Debt consolidation loans
Debt consolidation is a great way to get rid of high-interest bills or to meet large expenses such as college tuition or taking that dream vacation. …