Real Estate Innovation

Advice on Getting Bad Credit Financing

Are you trying to get a new loan or attempting to refinance an exisiting one and are finding it very difficult due to your poor credit score? You can take heart in the fact that there are lenders out there that can accomodate you. You just have to know where to find them. The internet is a great place to start as you can search a large number of lenders very quickly and narrow them down to the ones that offer the best rates. In this article I will share a few tips to help you get approved for the best loans.

Using a Co-Signer

The better your credit score, the better your rates. So if you don’t have great credit, look for someone who does. By having them co-sign for your loan, you can find yourself qualifying for much better rates. Lenders look at your co-signers record, but you pay for the loan.

If you are married, use the best score to apply for a loan. You can research which partner has the best score online.

Ensure Your Credit Report is Kept Up To Date

It is a good idea to check your credit report regularly to ensure that all the information is current. Also consider writing a letter giving an explanation for your poor credit score. Lenders will account for mitigating circumstances such as illness or loss of job.

Rid Yourself of Old Debt and Hang on to Cash Assets

It isn’t only your ability to repay the loan that is considered by lenders. They also look at any existing debt and cash assets. You’ll will look more promising if you are carrying less debt, especially if you have high earnings.

Lenders look for what cash assets you may have when considering you for a loan. This may be in the form of savings or money market. You should aim to have a least six months of cash reserves.

Do Not Give False Information

More than likely, you will be approved for refinancing. What rates you qualify for depends on your information. So to get the most accurate loan estimate, be honest about your credit background. That way, when you actually apply for the loan, you will be approved for the rate quoted.

Remember too that not all lenders charge the same rate. A careful search will bring up favorable rates, even for those with poor credit. Sub-prime lenders often provide loans on a point or two