Can I apply for a Home Equity Loan with a bad credit and no
home equity?
The answer to these questions under certain circumstances
can be "yes". Sometimes a situation occurs when
you do need fast cash if you face a family emergency.
What are your chances to get a loan against your home if
you have not accumulated any equity on it?
Let's see first how much can an average person borrow against
their home equity. Basically you can calculate it by subtracting
the amount you still owe on your mortgage from the entire
amount you have borrowed to purchase your home. If the result
is zero, you might want to consider the following: have your
home appraised. Find out what the market value of your house
it. If it's higher than the amount you owe, you might have
a great chance to receive a loan against your home without
having any equity on it yet.
Normally people can borrow 100% or less of their home value.
But in cases described above a lender might consider giving
you a loan of up to 125% of your home value. Such loans represent
a much higher risk from a lender's point of view therefore
interest rates will be considerably higher.
What other factor make an impact on your home equity loans
interest rates? Your credit score. The better credit history
you've managed to maintain, the lower interest rates you will
be able to get.
Having said this, however, it does not mean that you are
totally hopeless if your credit score is anything less than
perfect. It is highly recommended to shop around and explore
secondary broker agencies to find out what their interest
rates are for a homeowner with lower credit scores. They might
often agree to lend you money on better conditions than the
banks would.
Lowest
Rates Home Equity Loan Articles
|
