About Home Loans for Self Employed Individuals

Gone are the days when loans are only for people with regular jobs. Due to the rising number of people who prefer to be self-employed and work online or put up their own small businesses, more and more financial institutions are offering options for loans for self employed individuals. And among the popular choices include the home loans for the self employed.

A home loan is a type of loan you will apply for if you wish to buy a house and pay for it on a monthly basis within a certain period time. This simply means that you have to repay the loan within the specified number of months or years that you agreed and the lender agreed upon. The monthly rate will depend on the terms of the lender from where you borrowed the money,  along with the duration of the loan. This type of loan is perfect if you do not have the enough cash on hand to pay for the house you want to purchase. Obtaining a home loan will basically make buying the house much easier.

In general, there are two types of home loans for self employed individuals: fixed rate mortgages and variable rate mortgages (and a fixed rate loan is really the way to go if you’re buying your first home with bad credit).

The fixed rate mortgage loan is the one that is mostly chosen by many borrowers. This is considered as one of the best home loans for self employed individuals. With this type of home loan, the interest rate does not change throughout the duration of the loan, regardless of the state of the economy. The monthly amortization payment is also the same throughout the loan period, so this type of loan will allow you to set aside the same amount of money every month for your home payment, just like the payday loans for self employed individuals.

The variable rate mortgages, on the other hand, is considered a risky type of home loan and is for those thinking of applying for home loans for self employed. This loan has an adjustable interest rate that will depend on the economy’s movement. The monthly amortization payment may increase or decrease depending on the stability of the economy and, therefore will not allow the borrower to predict or set aside a fixed amount of money for his or her home payment.

How to Get Interest Rates Reduced on Loans

Many people who have mortgages and other types of loans simply take the interest rate that is offered to them by the lender. Most of these people are unaware that there are a couple of ways that they can get cheaper interest rates. Consumers who are wondering how to get interest rates reduced will be pleased to hear that it is a simple process.

The first thing that people who are in the market for a loan should do is shop around. One of the biggest mistakes that people make when it comes to lending, is to stick with the same provider they have used for the majority of their lives. The lending business is competitive and this means both banks and finance companies are prepared to offer good interest rates to their customer.

Generally a bank will be able to give a customer a cheaper interest rate than a finance company. This is because banks have a lot more security to back them up if their customers do not pay back their loans. Also banks are very conservative about who they lend their money to. If a customer does not have a regular income and a clean credit history, a bank will not touch them. This leaves some customers with no option but to turn to a finance company. Finance companies will then charge a higher interest rate because the customer is deemed to be high risk.

Once the customer has shopped around and has a list of interest rates that various companies are prepared to offer they should get back on the phone. Consumers should now tell the lender that another company has offered them a cheaper rate and wait to see if the lender can give them a discount. Many people are unaware that lenders have a degree of flexibility when it comes to interest rates. While they will not want to drop the rate, they will be prepared to do it in order to snag a customer. Lastly those with very bad credit looking for products such as credit cards for people with bad credit, will have to put up with high interest rates until they rebuild their credit history.

Guaranteed Signature Loans

By definition, a signature loan requires nothing more than your name on the dotted line for approval. But “nothing more than your signature” means “we’re not asking for collateral.” A signature loan doesn’t require collateral. But why doesn’t it require collateral? Because the applicant’s credit score and credit history are so good that the lender isn’t concerned about losing his money. Your word and your track record are enough to give him that peaceful feeling that he’s going to get back all the money he lent you, plus a healthy amount of interest.

In other words, getting a guaranteed approval signature loan requires good credit AND a well-established history as a borrower. If that’s not you, well, you’re going to find it nearly impossible to get a guaranteed signature loan (or any loan). We are NOT talking about guaranteed loans for bad credit no fees.

How much could you borrow with this kind of loan? Assuming you have great credit, the amount you can borrow will be based strictly on your income and debt to credit ratios. More income, bigger loan. More income, lower total debt in your name, bigger loan. Average income, higher credit balances, smaller loan.

The more debt you have, the more your current payments eat up your income. If a lender is going to guarantee approval of a signature loan, they’re going to have to see that the payment on the new loan, combined with your current loan payments, won’t take you into the red and jeopardize your ability to make payments on time. See, these kinds of lenders know the payment on your newest unsecured loan will be the very last one you think about paying if you experience a serious downturn in your finances. Before you bother with them you’re going to make sure you keep your house and car payments as current as possible. Then you’ll take care of your credit cards (because you don’t want them closed), and then finally you’ll think about these outstanding personal loans.

All of that makes the lender very nervous about you, and the only way to calm their nerves is to show that not very many people are ahead of them in line when it comes to monthly payments. Lenders typically want to see that your new payment, combined with all other monthly loan payments, total less than approximately 40% of your gross income. Do the math yourself before you go apply. If you find your income isn’t going to be high enough to meet their requirements given your debt load, don’t bother with the application. After all, maybe it’s a clue as to whether you should be guaranteed loans no credit check at all if the bank isn’t very excited to lend you the money.

Personal Lending to People with Bad Credit

The whole industry of personal loans lending has become one of the most hated and controversial aspects in the world of finance and banking. Why? Because on the surface it seems to be true that the business operating in this market are taking advantage of the poorest segment of society, lending them money they may or may not be able to pay at almost unimaginable interest rates. While this assessment of the industry isn’t completely unfair, it’s not realistic to say that every person who ever uses personal money lending is down to their last dollar, just about to move onto the streets. There are plenty of examples to the contrary.

One example would be commission-based salespeople. I spent a few years in the world of all commission sales, and I can tell you there were more than a few times where I’d have one or two bad weeks and end up running very short of cash. Fortunately I had credit cards and an overdraft line of credit with my bank that got me through until I had another good run of sales, refilling my accounts with plenty of cash. But what if I’d had bad credit or no credit? Most likely, bad credit personal signature loans would have been my only option.

Another example of a completely normal person who’d need a personal loan to make it by would be a small business owner or a self-employed person. Many independent contractors operate on a 30 or 60 day billing cycle. So their business can be completely thriving, with customers coming out of the woodwork, but they still find themselves cash poor because they haven’t been paid on last month’s invoices. I know a few freelance computer programmers who have had clients take over six months to pay their bills. If that happens with more than one or two clients the contractor ends up short of cash, needing the help of a personal loan lending company.

I think we all understand that it’s in no one’s best interest to make frequent visits to personal lending companies who give loans to people with terrible credit. But we can’t just operate under the assumption that every one who ever borrows money this way is destitute – or stupid. There are perfectly legitimate reasons a person would need to borrow some fast cash for a week or two (something along the lines of a $1500 loan, and your average payday loan store is just what they need – especially if they’ve got damaged credit.

‘How do I get a home equity loan on my mobile home with bad credit?’

Most people don’t realize that mobile home loans behave very much like traditional home loans. That might come as a surprise since mobile homes can ‘pick up and move,’ but it’s true. Mortgages for mobile homes have a lot of the same characteristics as loans on houses that are ‘stuck,’ including the ability to borrow money against their own value. It’s true – mobile home equity loans are a very real thing, even if you have bad credit. The only real difference between an equity loan you’d take out on your mobile residence and the kind I’d take out on mine will likely be the difference in amounts. Since single family homes tend to be a lot more expensive, there’s just simply more equity to borrow.

So let’s talk about what you’ll have to go through as part of applying for a bad credit mobile home equity loan. First the lender will want to know what year your home was manufactured in. That’s logical enough, given the fact that mobile homes are going to deteriorate more over time than a single family home would. The older your home, the lower its value is likely to be, which means there won’t be as much equity for you to cash out.

The bank will also want to know exactly how bad your credit is. There’s a difference between having missed a few credit card payments and something more major like having gone through a home foreclosure at some point in your life. If you’ve ever had a foreclosure, I’m afraid you’ll find it tough to borrow any of the equity from your mobile home. It just makes you too much of a credit risk. Now, that doesn’t mean that you could never get the loan after going through a foreclosure – you just might have to have a co-signer whose credit is much cleaner than yours.

Another key part of the application process will be how much of a balance – if any – you have on your home loan now. This is where loans on mobile homes are similar to normal mortgages; if you owe too much the bank isn’t going to want to let you increase the total indebtedness on the home by cashing out some of the equity. Hopefully your home is free and clear, and relatively new, so your chances of borrowing a decent amount are increased.

Finally, before anyone will give you a home equity loan for a mobile home with bad credit, they’ll want to know what type of property your home sits on. Is it in a mobile home park? On family property? Other rented land? If your home sits on property you actually own it’s going to be much easier to get the loan you’re looking for.

Be persistent. It’s likely that lending will be tighter from now on, with banks looking more carefully than ever at your income and credit history before giving you any kind of loan. You might have to spend a few months or even a year making yourself look good enough on paper for them to lend you the money.

Startup Business Loans for Bad Credit

No matter what anybody says, the American Dream is still to own your own business, your own income stream, and your own time. I’ve been a full time entrepreneur for a while now, and as I write this I’m sitting in my office feeling happy and grateful that I have a lot of say in my own financial destiny. But the reality is that starting a business can be an intimidating thing, and getting it off the ground usually requires more cash than most people have.  And if you’ve hurt your credit at some point you might have to see about qualifying for bad credit startup business loans.

The fact is you can still get financing if your personal credit score is pretty low, but you can forget about traditional banks. If they see that your FICO score is below 650 or so, there’s just not much chance they’ll want anything to do with you. To combat your own bad credit, the best place to start is to try to build up some kind of corporate credit. You need to set up an official entity, such as an LLC or other corporation, and immediately apply for some small lines of credit through that entity.

Many credit card providers will have some kind of bad credit credit card for startup businesses. Be prepared for high fees and APR’s, but if you can handle those hurdles you’re going to be able to get at least some kind of credit lines as a business. Even if you get a $300 credit card and start using it for normal purchases, you’ll be on your way to establishing some corporate credit. Down the road you’ll find that local banks, credit unions, equipment manufacturers and other lenders will consider you much less of a risk if you’ve shown some improvement in your personal credit in combination with some corporate credit history.

Here are a few things business financiers will be looking for when deciding whether to give you the startup small business loan you need to get things going:

  • you’ll have to be compliant with a list of 20 different criteria (for example: whether you have a business name, whether you have a business phone number, whether you’re listed with any of the major business review companies, etc)
  • you’ll need three national credit reports – each of them reflecting your credit worthiness
  • up to five credit lines directly from vendors that report to the major credit agencies

Of course there are other criteria, but these are the things to be most concerned about as you try to get small startup business loans. The main thing will be perseverance, as this is the stage where many would-be entrepreneurs get frustrated and quit. All I can promise you is that it will be worth any effort to get your own business off the ground.

‘How Can I Reduce My Debt?’ Get Some Answers

There’s almost no stress that weighs more heavily on a person’s mind than the worry caused by excessive debt. It’s an interesting thing to observe what debt does to a person’s psyche – it crushes their creativity, nearly eliminates their ability to set goals and dream about a better future, and it can even damage a person’s physical health. What it all comes down to is that debt is bondage; it’s a form of self-inflicted slavery from which everyone who’s in it wants to escape. Don’t worry – if you’re sitting there saying “Yes, but I have no idea how to reduce my debt,” there’s hope. It’s not going to be an easy path, but you can absolutely get there.

First we should talk about the traditional methods for getting rid of debt. One of the most popular in the world is called the snowball method, and it boils down to attacking one piece of debt at a time until you’ve eliminated all of it. For example, let’s say you’ve got two credit cards, a car payment, and your mortgage payment. One credit card has a balance of $10,000 and the other has a balance of $5,000. You owe $12,000 on the car and you have a remaining balance of $250,000 on your home. If you approach this process the right way you can end up paying it all off within 7 years or so, and live debt free for the rest of your life.

You’ll start with the smallest debt – the $5,000 credit card balance. Dig into your financial situation and find an extra $100 or so per month. Apply that $100 per month to your credit card balance, and combine with your monthly minimum payment. Your total payment will probably be in the neighborhood of $200 or $250. It will take nearly two years, but you’ll be rid of that credit card balance. When you’re finished, take the entire payment you’ve been making to that credit card, combine it with the monthly minimum payment you owe on the next credit card, and you’ll pay it off a lot more quickly. Continue with this process on the car and your house, and the next thing you know (a few years later), you’ll be debt free and loving life.

The snowball method is one of the most famous and popular solutions for people saying “I want to know how to reduce my credit card debt.” If you discipline yourself to find the extra money in your monthly budget, apply it aggressively to one debt at a time, and stick with the plan for a few short years, you’ll enjoy total debt freedom for the very first time. I promise you nothing could ever feel better than knowing that you owe nothing to no one. Good luck, and hang in there.

Unsecured Loans from Banks for People with Bad Credit

Every day thousands of Americans find themselves a little short of cash, and a little “long” on bills. It’s frustrating, discouraging, and embarrassing when you can’t make your bills despite your best intentions and your best efforts. If you’re not in a position to borrow from friends, family, or credit cards, you might end up having to use unsecured personal loans from banks. It’s not an ideal option due to the notoriously high fees charged and interest charged on these kinds of loans, but you have to do what you have to do.

Now, the ideal scenario would be that you’d you borrow from a bank as opposed to an online lender. I know how convenient the online loan providers are, but that convenience comes at a high price. If you borrow from a website and then renew that loan several times you’ll look back in shock and horror at the cash you’ve wasted. Borrowing from any of these fly by night lending websites (other than those few that are credible – such as LendingTree) really puts you at a huge financial risk. That’s why it’s so much safer to borrow guaranteed loans no credit check for people with bad credit directly from banks in your locale.

Sure, I understand that it can be pretty humiliating to physically walk into the nearest branch of your bank, sit down with a member services representative, and explain that you need to borrow a few hundred bucks to get you through to your next paycheck. Keep a few things in mind that should help you feel less embarrassed. One, you’re by no stretch of the imagination the first person to need this kind of loan. I bet if you walk out your front door and survey the houses around yours you’d find that at least one of your close neighbors has been in the very position you’re in now. It might even be that neighbor who you thought had it all put together in his life. The fact is almost everyone has had to borrow cash in a crunch. And hey, if you really can’t stand to walk into your bank branch, check out your options with Lending Tree bad credit. It’s a reputable site with quite a few personal loan options.

Second, remind yourself how much better off you are getting instant decision unsecured personal loans with bad credit from your own bank instead of some faceless website whose headquarters are hundreds or thousands of miles away. Your bank – where you have a checking and savings account, and possibly a track record of responsible borrowing, will treat you much better than you could hope for with an online lender.

Finally, there’s something to be said for the psychological effect of having to sit in front of another human being and explain your need for cash. It won’t be pleasant, and that’s a good thing. After all, the more painful you can make this experience, the less likely you are to let yourself get in this position again. Be careful with unsecured loans no credit check, make your payments on time, and start saving more money so you don’t need short term unsecured loans from banks again in the future.

Small Business Debt Consolidation Loans and Programs

Usually sometime in the first one to two years of a business’s life it’s going to run into some serious cash flow challenges. This is even true for businesses with a great product whose sales jump up to health levels right away. What many people don’t realize about running a small business is that success can be expensive. Often business owners have to borrow money to stay ahead of demand, and borrowing money often leads to trouble. If a business owner can’t manage her monthly debt service a small business debt consolidation may be her only solution.

A small business debt consolidation loan often behaves in a very similar way to consolidation programs that individuals with too much debt go through. Meaning, the business contracts a company to approach its creditors and begin a negotiation process that results in either a) lower principle balances on the loans, b) lower interest rates on the principle, or c) both.

Banks are willing to work through these negotiations once the consolidation company makes it very clear that the alternative is to have the business owner essentially walk away from the loans, leaving the bank with nothing. It’s a situation where the bank realizes “this is the best we’re going to get, so we’d rather take 40 cents on the dollar than get nothing at all.”

Since the business owner ends up fulfilling something other than the originally agreed-upon loan terms, his or her credit rating will be affected. If the loans are in her own name, her personal credit score will take a dive. If she borrowed the money through her corporation, then any corporate credit she’d established will take a serious hit. If you go through a small business debt consolidation program you’re not likely to be able to borrow any more money for your business for a long time. That’s something to consider before you take on the risk of business loans in the first place.

One thing to consider is that small business debt consolidation loans aren’t for you in the first place. Even if your loans are starting to overwhelm you, a consolidation company may not be able to improve your situation much. For example, if your interest rates are reasonably low, consolidating all your balances to one won’t make a significant difference. If you can’t get a reduction in principle there’s really no point consolidating your business debt, so keep that in mind.

Overall, borrowing money for something as risky as a business startup isn’t something you should do unless you’re very confident the business will be able to make the payments on the loans. Starting a business is stressful enough without having the added worry of not being to keep your payments current.

Getting a Mortgage Refinance With Bad Credit is Easy

Having bad credit does not have to stop you from getting a mortgage refinance. What seemed nearly impossible to some, is now fairly easy to accomplish. In fact, many online lenders are fighting to get your business. Even though people with bad credit are risky borrowers, many lenders will offer them a mortgage refinance because they can simply combat these high risk borrowers by a slapping them with a higher interest rate. Since rates are at record lows for people with good credit, the rates you can receive with bad credit may still be low.

While getting a mortgage refinance with bad credit can be simple, be sure to shop around for the best interest rate. Also, each lender may have different types of loans they offer, so find the best loan that works for you. For instance, some loans allow you to purchase points. Mortgage points allow you to pay more up front, but you will receive a lower interest rate for the life of the mortgage. You can also choose between a fixed or variable interest rate loan. If you choose a variable rate mortgage, also known as an ARM, understand how often the rate will change and at what percentage it can increase or decrease. With rates so low now, it is more advantageous to refinance with a fixed interest rate.

Be sure to check for any fees and how much the lender will charge you to complete the refinance. Some lenders are cheaper than others. If the purpose of the refinance is to lower your monthly payment, make sure you can afford the new monthly payment before you sign the loan papers. Also, make sure the new mortgage does not contain a pre-payment penalty, or you could be penalized for refinancing or paying the mortgage in full early.

To get a mortgage refinance with bad credit, apply online by filling out an application form. An agent will usually contact you to discuss your options. Look for lenders who specialize in mortgage refinances for people with bad credit. Agents from these lenders can help you choose the loan that best fits your needs. The purpose of the refinance will determine what type of loan will best fit your needs and how it will benefit you. If you have a Fannie Mae or Feddie Mac loan, ask the lender about Obama’s national mortgage refinancing program.

A Low Interest Home Equity Loan is the Way to Go

In today’s cash strapped economy, many homeowners are looking for alternate ways of generating some cash for household needs, debts and emergencies. With credit card rates soaring and retro-activating against previous purchases, many people are looking to lower their interest burdens by paying off high interest debt. Personal loans are high in demand, but often require borrowers to come up with collateral in exchange for rates that are similarly high to credit cards. Peer to peer lending is another solution, but it usually requires exceptional credit and funding is not guaranteed. In the light of this, many are turning to home equity loans for their debt solutions.

Home equity loans are simply loans taken out against your home. There are many benefits to borrowing against a home, as many home owners enjoy a nice cushion of equity early on their mortgages through down payments and expedient payoff schedules. Because a home equity loan is viewed as a second mortgage, the interest on the loan is very low, usually hovering around the same rates as a thirty year fixed loan. The interest is usually tax deductible and borrowers tend to have low payments that are hardly noticed as they are stretched out over a long period of time.

Though home equity loans are beneficial to many who find themselves slave to their debts and obligations, one should be careful before hastily borrowing against their home. Once a loan is taken out against a home, it is no longer protected against bank repossession, which is dangerous ground for those struggling to make end’s meet. Once a home equity loan has been defaulted on, the home acts as collateral to recover the debts.

Overall, home equity loans prove to be wise decisions for many people, regardless of the needs of the borrower. A financial adviser can often provide a third party outsider’s view and help guide your decision in taking out a low interest home equity loan. There are many companies, banks, and financing institutions that are more than willing to help their customers with their banking and loan needs. For those that find themselves sinking farther into a debt sinkhole, maybe you should consider taking a cue from your house. That equity is sitting dormant and can be used to save money both in the present, and long term as well.

Business Loans For Bad Credit to Get Your New Venture Off the Ground

Trying to get a business loan with bad credit is not an easy task. Lenders may see anyone with a credit score less than 650 as a real risk, and may not want to take a chance of not getting their money back. Bad credit is quite common amongst most people, especially if they are young and inexperienced with finances. A business loan is important for the start-up capital along with expansion and maintenance as your company begins to grow. Some small business owners who took out an initial loan may find themselves not being approved for another because of late payments or delinquent accounts. Most lenders and institutions look at an applicant’s personal and business credit history before approving them for a loan. In the end, many business owners try to turn to small loan companies or even friends and family. The problem is, this is really unrealistic and doesn’t offer real solutions.

There are some other alternatives for attaining a business loan. Business cash advances are also available for those that have a poor credit score or payment history. Merchants can attain these advances even with poor credit. Cash advances have many benefits. What many business owners like about this option is the flexible repayment options. This is important in order to not fall behind on your bills. There is no collateral needed. Most lending institutions require applicants to have some sort of collateral if their credit is poor or horrible. So in the end, bad credit is not an issue with attaining a business cash advance.

There are many lending cash advance centers that can be of assistance of acquiring about a loan. These cash advance business loans can amount anywhere between $5000 to $1,000,000! Business owners can get their money in less than 72 hours on some sites. Make sure to do your homework and get reviews online about any lending company before trying to get a business advance loan. Another benefit to these types of loans is that there are no closing costs or other fees. They are often used more in personal businesses.

Another option for getting business loans for bad credit is to use your 401 (k). If you have an account of this nature, you can tap into it to receive a business loan. This can be used as collateral with lending institutions. Not all institutions offer this, but there are some lending companies that provide this option.

Finding a business loan for bad credit can be a hassle, but it is not impossible. Finding the right lending institution with a good background and positive reviews with past customers is the key.

Refinancing Your Car With Bad Credit

Out of all the problems associated with having bad credit, getting a car refinance loan often isn’t one of them. Refinancing your car with bad credit is fairly easy, due to the fact that the car serves as collateral. A willingness to put up decent collateral is often reciprocated by lenders, who suddenly become willing to deal with you.

There are several possibilities for refinancing your car with bad credit (we could be talking about $5000 auto loans – or much bigger numbers). The best of these options include banks and other well-established lenders. Many of them even have online applications where they specifically solicit bad-credit customers. Even though interest rates are higher for people with bad credit, these lenders are often about as good as they get in the industry, with repayment terms being fairly straightforward. These operations, as a rule, will stick to the contract, so you can rest easy knowing that if you pay the bill, you keep your car.

In cities of any decent size, it is possible to find independent lots who claim that they are willing to lend to everyone who has the ability to breathe. This part of the car-refinance industry, unfortunately, has a big reputation for being shady or worse. Horror stories abound. Therefore, it’s best to avoid these operations, and go for a big lender, preferably one which is nationwide or at least statewide. Large lenders, if only because of their size, have to withstand more regulatory scrutiny. Therefore, big lenders are more likely to play by the book.

One good source of car refinancing may be a bit surprising. There are credit card companies which also have auto and even home refinancing arms. Some of these companies specialize in dealing with people who have bad credit. Refinancing your car through them can work very well.

Refinancing your car with bad credit does not have to be hard or cause undue grief. With good research, you can find plenty of reputable companies to deal with. When looking online, look for car refinance deals which are attached to banks or credit card issuers. Many bad-credit lenders online also advertise through various affiliate sites and promoters. This is fine, as long as the company actually doing the lending is a reputable one. Look in the tiny type in any agreements you are asked to approve to see who is actually behind a bad-credit refinance offer, as well as to see all of the relevant terms and conditions.

How to Find a Bad Credit Refinance Loan for Your Home

If you’re looking for a bad credit refinance loan, there are two things we probably know about you. One, you’ve most likely kept up on your mortgage payments. Two, other debt obligations have been either neglected (meaning you’ve missed  a payment here and there), or ignored completely (meaning you gave up on trying to repay the debt – could have been a car repo or something along those lines). Now you’d like to refinance, and who knows why. Could be a variety of reasons that you want to refinance your home loan even though you have bad credit. Here are a few I can think of:

1. You want to get some of the equity out of the house to pay off some bad debts.

2. You’re just trying to take advantage of low rates and get your monthly payment down.

3. You’ve realized you’re not going to have much luck selling your home, so you’re thinking about improving and/or adding onto it.

Whatever the reason you’re trying to refi your house, you better go in with your eyes wide open, because when you start the refinance process – especially with bad credit – you’re basically starting the mortgage qualification process over again from scratch.

You need to have a few things in place before you even think about a refi.

First of all, do you really have enough equity to keep your ratios inline? You’re going to need to have 20% equity left over – after you complete the refinance process. If your home is worth $250,000, and you want to borrow $20,000 to fix up the house, then your current indebtedness can’t be more than about $175,000. I know those numbers don’t quite add up; more on that in a minute.

Second, your debt to income ratio can’t go up to much with the new loan (obviously this only applies if you’re trying to borrow money out of the house to fix it up or pay off other debt). If you’re borrowing the money just to fix up the house, you’re probably looking at about $6-$9 added onto your monthly payment per $1,000 borrowed. Let’s say it’s $9.  A $20,000 loan will increase your monthly payment by $180, give or take. Take that into consideration.

On the other hand, pulling out some cash to pay off credit card debt could improve your debt to income ratio. Your credit card payment usually comes in at about $25 per $1,000 borrowed, so trading that in for $9 per $1,000 borrowed would help a lot. Not to mention the fact that sometimes the interest on that new mortgage debt will be tax deductible, whereas credit card debt is never going to be.

If you happen to be refinancing just to lower your payment, make sure you fully understand the costs associated with the refi, because it will take at least a few years at the new lower payment to recoup the cost of refinancing with bad credit. Let’s say your new mortgage is $150 lower, and the total closing costs on the house were $5,000 (I think that’s pretty conservative). It would take you almost three years before you realize the benefit of the refi. If you think about the fact that lowering your interest rate hurts your tax deductions, it actually takes you longer to really enjoy the benefits of refinancing your house.

Keep all these issues in mind if you have bad credit and want to refinance your home loan. There are a lot of ways it can benefit you, but if you don’t factor in all the real costs, you might not be getting ahead at all.

A Poor Credit Mortgage Loan to Put You in Your Own Home

There are quite few myths surrounding whether a person with bad credit can get a mortgage loan – myths on both sides of the table. You have people who say think there’s basically no such thing as a poor credit mortgage loan; and you have people who think that a person with awful credit – if they look hard enough – will find a loan that requires nothing more than their signature, a firm handshake, and a winning smile.

Both groups are misinformed, to say the least, and we can address them both at the same time.

There are plenty of poor credit mortgage loans out there. There is an entire subset of the lending market dedicated entirely to the bad credit, or ‘subprime,’ borrower. The terms of these loans take into account the subpar credit standing of the borrower. They’ll carry higher interest rates, and probably require higher up front fees (if the borrower chooses to buy down their rate with ‘points’).

Bad credit borrowers will almost certainly have to prove their income beyond all doubt – I doubt people with bad credit would have a very easy time getting a ‘stated-income’ mortgage. The lender is going to want to see a couple of years’ worth of tax forms, pay stubs, or both.

Here’s the big kicker – if you don’t have a 20% down payment or more, I’d say you’re a couple of years away from qualifying for a home loan. I can’t really say I think that’s a bad thing though. Think about it. Let’s say you want to buy a $200,000 house. You need to come up with a $40,000 down payment. If you can set aside $800 per month, you’ll have your down payment in a little over four years.  Now, that may seem like an eternity to you, but you can get a lot done in your financial life in four years.

You can significantly improve your credit – maybe to the point that a mortgage loan with poor credit isn’t something you even need to worry about. You can consistently increase your income – which will make it easier for you to furnish and landscape this big new home you’re buying. Most importantly, you can enjoy the benefits of waiting and working for a goal that means a lot to you. I really believe our society would be much better off if everyone who wanted to buy a home had to spend five years or so getting ready for it. Not only would you have much more savvy home buyers, you’d have happier, less stressed people out there who could actually afford their home.

Seems to me that working a few years to prepare for a commitment that will last at least 30 years isn’t a lot to ask.

How to Get Home Equity Loans with Bad Credit

Bad credit puts you in a hole in any lending situation, and it’s tough because no matter how you try to explain away your low Fico score with circumstances and events beyond your control, the hard fact is you didn’t make your payments on time (or maybe at all), and now the credit bureaus are telling lenders to steer clear of you. If you happen to be a home owner, and you need to get some cash out of your house, home equity loans for people with bad credit are going to be nearly your only option.

And I’m sure you can understand why. If you take a step back and look at things from the bank’s perspective, giving you a home equity loan in spite of your bad credit probably doesn’t seem like a very good idea. After all, by taking on this new credit line, you’re not really changing anything about your financial situation except creating another opportunity to increase your monthly debt load and increase the risk of you starting to miss payments again.

That might not always be true. You might be opening the home equity line because you’re going to use it to pay off some credit card debt or medical bills or something along those lines. If that’s the case a lender might look at the situation more favorably because you’ll be getting rid of those brutal interest rates and payments on your cards by transferring the balances over to a lower interest credit line.

Just how much lower that interest rate will be is up in the air. Good credit borrowers might get something near the prime rate on their equity loan, but home equity loans for bad credit could run in the prime+5% ballpark. So, yes, that’s much better than the 20% to 30% you’re going to deal with on credit cards, but it’s not really a low rate loan.

The question is, how can you make yourself look better to the banks. In my mind there are only two ways that’s going to happen.

You could a) wait a couple years while you clear out some debt and watch your credit score improve as you zero out balances and make consistent payments (and maybe even write some dispute letters about blemishes on your score, or b) get someone with shiny undamaged credit to co-sign with you.

That could be a very tricky situation. It’s likely that a nobody will want to co-sign with you unless you’re fairly close, but having someone close put their name by yours on a loan – after what you’ve done to your credit in the past – creates some potential risk to the relationship that you should think long and hard about. If you know – and I mean know that you’re going to make your payments, that your employment is stable, and that everything will work out….getting a co-signer is probably the best option. It might make it so you don’t need home equity loans with bad credit at all – you could get the ‘good credit’ kind instead.

No Credit Check Home Loans

No credit check home loans, huh? I guess it’s worth a shot; you’re thinking “somebody out there on the worldwide web must offer a home loan that doesn’t require a credit check at all.” Well, I’m not going to say that there is definitely no such thing, but it’s going to be a lot tougher to get than a $5000 loan no credit check. Let’s talk about it.

If a lender doesn’t check your credit before giving you a home loan, on what criteria could they possibly qualify you?

Okay, that’s actually a fair question. Let’s put ourselves in the shoes of the lender, and pretend that we are trying to decide whether to give a person a home loan without looking at any kind of credit history. What criteria could we use?

1. The down payment. Not only will the down payment reduce the risk to the lender, it says something significant about the prospective borrower. It means they’ve saved money over a period of time, and probably a substantial amount of money. If possible, I’d like to get records of deposits going back several years to see how much they’d be setting aside each month, and how consistently they did it. That way, if I couldn’t see a record of payments they’d made to creditors, I could at least see a record of unforced payments made to themselves. That would be a good indicator of their credit worthiness.

2. The income statement. I’d have to know that they’re monthly income could more than support the monthly payment on the loan I’m giving them, even if I had the record of their excellent savings habits.

3. The debt statement. This is close to a credit history, but I’m not even wanting to see a track record of payments. I need to know what their monthly debt service is so I can do the simple math and decide whether the new loan payment is going to overload them.

4. Serious personal references. I’d have a loan processor call at least 5 to 10 people that are both impartial and know the person well enough to say whether the applicant is credit worthy. I’d be looking to hear that the applicant is one of the most disciplined, responsible people they’ve known.

With those four criteria in place, I suppose you could theoretically give somebody a home loan with no credit check. But I’m afraid you’re still dreaming. It’s never going to happen. The best thing you can do is apply for a bad credit home loan. Those really do exist, but guess what? The first three criteria I mentioned above will be a major factor in that process as well, so you’d better make sure you have them in line if you want to buy a home and you have no credit or bad credit.

Getting Online Loans with Bad Credit

Your search for online loans with bad credit could you end with you buying a car, taking out a payday loan, applying for a secured credit card, or refinancing your house. I think it’s safe to say there’s almost no type of loan out there that can’t be found online anymore, and that’s really to your advantage. When borrowers have so many different options in one place it forces lenders and brokers to provide the very best terms they can, as well as pushing them to give better and better service.

Some of the most commonly sought loans are instant unsecured personal loans. In this group you could include payday loans and signature loans with bad credit. In any case, the goal of the loan-seeker is to get a short term cash loan overnight that bridges the gap between today and their next paycheck. These loans are most often used in emergency situations, and lenders capitalize on the relative desperation of the applicants by charging extremely high fees or interest rates on these loans – sometimes as much as $30 per $100 borrowed on a loan with a term of 7 to 14 days. If you annualize that interest rate you’ll be ill, so don’t bother.

Another commonly searched loan is the guaranteed bad credit online loan. Now, some confusion tends to settle around the term ‘guaranteed’ with this loan. I believe most web searchers are using the word guaranteed in their search in hopes that the loans they find will come with guaranteed approval, and that is often the case. On the other hand, a guaranteed online loan can be one where the applicant brings a type of co-signer to the qualification process due to his or her bad credit. The co-signer is most often a friend, family member, or representative of a community club or organization the applicant belongs to. This guarantor’s role is to say “If he skips out on the loan, I’ll make his payments.”

This kind of a situation tends to go much better for the lender for two reasons. One, the co-signer will is committed to making the payments, so the bank has an extra line of defense against losing their money. Second, the co-signer creates some very personal accountability for the borrower.

Finally, you have unsecured signature loans (payday loans), which usually doesn’t require much from the applicant and can put the money in his/her account within a few hours of approval. All the applicant will have to show here is that she has an active bank account with direct deposit capability (both for the cash to be put in and for payments to be automatically withdrawn) and a steady job.

So you can see that there are plenty of options when it comes to online loans for bad credit. You just need to find the one that suits your situation best.

Car Loans for Poor Credit

Nearly every day I see ads – freeway ads, internet ads, and TV ads – appealing to car buyers with bad credit. The constantly echoed mantra is “we finance everybody, regardless of credit score.” The fact is, most of these advertisers aren’t lying; they’re being truthful about the fact that they’ll lend to nearly anyone. The question is whether they’re acting in the best interest of their customer.

As a person looking for car loans for poor credit, you need to accept two realities before you do your first web search for a new car or visit a single dealer: you’re going to pay a higher interest rate and you’re going to have to make a higher down payment, period. Those two facts are a foregone conclusion. Where you need to be cautious is in deciding whether the price of the car and the interest rate you’re being offered are anything reasonable.

The research I’ve done tells me there are some very unscrupulous lenders who will try to take advantage of your credit-challenged status – taking car loans for people with poor credit to another level. For example: they know that you’ll feel your options are limited due to your low Fico score, which means you’ll be less likely to walk away from their car lot if you really believe you won’t be able to find better deals out there. Knowing that, they’ll take a car whose normal value would be somewhere in the $2,500 range and stick a price of $5,000 on it. Then they’ll say they need $1,500 down and finance the remainder at something like 23%.

Sure, you could walk away with a car, but almost anyone’s standards you got screwed (pardon my french). The key to avoiding this situation is to do your own research on different makes and models of cars you might be interested in buying, studying their blue book values beforehand so you’ll at least have a sense of whether the dealer is trying to take advantage of you.

One of the best places to get a car loan with bad credit is an actual new car dealership (used cars got their reputation for a reason). If you can actually afford a new car, you’re much more likely to be treated honestly and fairly by a new car dealer who doesn’t just make their money from these outrageous financing deals – they actually profit from the sale of the car. That gives them better incentive to give you the best possible financing options so you’ll actually purchase the car.

The burden is ultimately on you to make sure the deal is in your best interest; you can’t count on anyone to care more about your financial situation than you do. My best advice is to get a small, economical car with you’re using a poor credit car loan to get it. Drive a little beater for a couple of years while you reestablish your credit and save some money, and then you can go out and buy a car you really want with terms that won’t make your financial advisor sick to his stomach.

Home Loans with Poor Credit

Recently I was talking with a friend who’s living with his parents right now, along with his wife and three kids. He’s 34, and he ended up living with his parents after going through a rough patch with his employment and missing some payments on his other debts. His wife’s credit went in the tank too, because her name was on the loans with the missed payments. It’s a bit of a mess, but a couple of years have passed since he went through all that, and he and his wife are looking to buy a new home now. Obviously they’re going to have to look into home loans with poor credit.

What people don’t realize is that getting a poor credit home loan isn’t a completely impersonal process. Yes, lenders have to consider your credit score as part of the qualification process, but that doesn’t mean they have to completely neglect the human element. The first and biggest piece of advice I’d give a  credit challenged home loan applicant is to contact every bank and credit union in your city or county.  Local lenders are much more likely to actually sit with you and have a sincere conversation about the factors in your application that don’t show up in a credit score.

You really want to explain to them, being completely truthful, what circumstances led to your bad credit status. Think of this like a job interview, and imagine you’re telling your new prospective boss why you got fired from your last job. It’s actually a very similar situation. One thing you don’t want to do is lie or make excuses. You’re trying to make it clear that the past is the past, and although you’re responsible for what happened, you’re never going to let it happen again. Make sure you can paint a very clear picture about what’s different in your circumstances now compared to when you wrecked your credit. They’ll appreciate a sincere explanation much more than a laundry list of hard luck excuses and stories about how “it’s not your fault.”

The next best piece of advice I can give isn’t something you can complete in a day, a week, a month, or probably even a year. You need to a) minimize your personal debt, b) increase your income, and c) save up a nice down payment. Remember, you’re trying dealing with home loans for people with poor credit. Nothing strengthens the message that you’ve changed more than being able to show them a credit report that, although it shows  a low score, doesn’t show any consumer debts on it.

There’s a psychological benefit as well as a tangible benefit to having almost no other debt when you’re trying to get your home loan. The tangible benefit is that your debt to income ratios will look great (especially if you followed the advice about finding ways to increase your income). The psychological benefit is that the underwriter will be able to look at your report and say “this person has obviously made some big changes in his/her personal finances.”

If you make the effort to go through these steps I feel confident you’ll be able to qualify for the home loan you want and need sometime in the next year or two.