Bad Credit Refinance Loan

If your credit score is in the bad to poor range below 620 and you have an existing loan or mortgage, chances are good that you are paying high interest and high fees for that loan. It is possible to get a bad credit refinance loan with a lower interest rate if you prepare in advance and do a careful search for your loan product. You should still be able to get a bad credit car loan refinance or a better mortgage.

With a bad credit score you get stuck with paying more because you present a higher loss risk to lenders. No matter what the reason is for your low credit score, there are ways to overcome this challenge and get a loan refinance with bad credit. Your current lender may have a loan modification program; ask them about it. If you are upside down in your mortgage, you owe more than the home is worth and will be unable to get a home equity loan but if you have made on time payments you may be able to refinance or modify the mortgage.

The first thing to do if you want bad credit refinance loans for your home mortgage or car loan, is to go to www.annualcreditreport.com and take a look at all three of your records held by the major credit reporting agencies. Equifax, Experian and Trans Union track the payment habits of people and are required to give you a free look at your report once a year. Read the reports carefully to be sure they are accurate. If there are mistakes, write them and ask for a review. They will investigate and make corrections if necessary. You can review the corrections later, for free.

Next, make sure you are on time with any payments on your debts, including utility bills. Do not apply for any credit yet. If you want a new or used car deal, do not allow the dealer to run your credit. They may do unscrupulous things like applying to a large number of resources, all of which will hit your credit report and lower your score even more. Do not drive off while they “get you approved” and later be told they could not get an approval. This will jack up the price of the vehicle and any financing the dealer might offer. Do not patronize “buy here pay here” auto dealers; they are too expensive all around, preying on bad credit buyers.

When you seek bad credit loan refinancing, go only to a reputable, established financial institution and not with a new company that may be risky for you to deal with. Join a credit union; they are known to offer good deals to members. Apply in person, face-to-face, because it is easier for the banker to make a decision if they have actually talked with you about your bad credit. Get a secured credit card from your credit union or bank and make regular payments. After at least six months, this should give your credit score a positive boost.