Bad Credit Lenders | Learn More About Poor Credit Home Mortgage Loans

APPLY TODAY MORTGAGE LOANS BAD CREDIT LOANS HARD MONEY LOANS LOAN TOOLS

Bad Credit Lenders for Poor Credit & Subprime Loans

Why You Would Need Bad Credit Lender

Bad credit lenders can help individuals with poor credit, low FICO scores or little to no assets and/or equity who find it difficut, if not impossible, to obtain a poor credit loan from a bank or other financial institution. If you do not qualify for an A paper, B paper or C paper loan, you move into what is called the subprime category.

Subprime mortgage loans are still executed through a financial institution, although the percentage rate on a subprime loan will be higher than if you had perfect credit and substantial income or equity. For borrowers who do not qualify for a subprime loan, the final lending option is a private loan.

Refinance Rates
Purchase Rates
Refinance Rates,
   Product:                      Today        Last Week
Compare rates in your area:
Mortgage Rates
Refinance Rates
Purchase Rates
Purchase Rates,
   Product:                      Today        Last Week
Compare rates in your area:
Mortgage Rates

Bad Credit Lenders | Discover The Range Of Rates & Points

A private loan, also referred to as a hard money loan or a bad credit loan, is made by a private individual or fund, as opposed to a bank. Because a private individual or fund is not FDIC insured, there is a greater risk involved for the lender. In addition, the borrower has a shakier track record with paying back their financial obligations and/or has less economic resources available to them and, therefore, carries a greater risk on defaulting on the loan. For these reasons, a hard money or bad credit lender charges a higher annual percentage rate and up front points. Bad credit lenders charge anywhere from 11%-16% plus 2 to 6 points. Lending amounts will vary by lender and by state.

The Benefits of Using a Bad Credit Lender

Borrowers should only apply for a bad credit loan after they have unsuccessfully applied for a financial loan from several financial institutions. Due to the high percent rate of a bad credit loan, borrowers should structure their hard money loans so that they do not exceed 12 to 18 months. The goal for a borrower in this situation is to rebuild their credit during this time (borrowers are not penalized by credit bureaus if they miss payments etc. on a bad credit loan because their loan is not recorded through a bank or other financial institution). With diligence and work, hopefully the borrower can now refinance their loan and obtain a subprime loan. This way, the borrower is on their way to reestablishing their financial future.

Related Topics

 

Bad Credit Home Equity Loan

Bad Credit Refinancing

Bad Credit Home Loans

Bad Credit Refinance Home Loans