Bad Credit Home Loans | Basics Of A Bad Credit Home Loan

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Basics Of A Bad Credit Home Loan

Bad Credit Home Loans

Bad credit home loans are ideal for individuals who have had credit problems in the past, but that need a loan for a new home purchase, mortgage refinance, debt consolidation loan or a bad credit home equity loan. If you do not qualify for a bank loan or a subprime loan, you may still qualify for a private mortgage loan -- also known as a hard money loan or bad credit loan.

Typically, you will need at least 25% equity in a property to use as collateral in order to qualify for a bad credit home loan. Your real estate collateral allows a private mortgage lender to feel less risk about making a bad credit refinance loan with your low fico score and/or bad credit. Without this equity, bad credit home loan mortgage services will not take on this loan because of the risk that the borrower will default on the loan.



Who Are Bad Credit Home Loans Ideal For?

Bad credit purchase loans are a good fit for anyone who has income and equity to secure a loan, but not the credit score to convince a bank to give them a purchase or home improvement loan. For these people, you may need to go with a private bad credit home lender for a 12 to 18 months period. The goal for any borrower at the end of this period should be to move into a subprime or Alt A loan.

Bad Credit Personal Loans

Bad credit personal loans vary only slightly from poor credit home loans. A bad credit personal loan is typically $50,000 or less and is used by an individual to help pay off credit card debt, home equity lines of credit or any number of additional financial encumbrances. Bad credit lending will usually require collateral – either real estate or other liquid assets. The loan rate and terms for a bad credit personal loan will vary and you should allows speak with a bad credit lender to learn about their programs and rates.

           

Bad Credit Perosnal Loans

Bad Credit Loans