A History of the Mortgage

An Overview of the Mortgage Process

Mortgages For People With Bad Credit

Bad Credit Second Mortgages

3 Tips For Finding The Best.


If you are one of the many people who now have a bad credit score due to the current financial climate, you may feel as though there is a big dark cloud following you around all day ever day.  If you are extremely lucky you maybe able to ignore that cloud if you do not need to take out a loan or apply for a credit card, but you would be in a small minority.

For everyone our credit score exerts a strong influence over our lives whether we realise it or not.  Depending on our credit score this influence will range from either being positive to negative.  How it influences will come into play when it comes to taking out a second mortgage.  If your credit score is bad i.e. under 600 you may find difficulty in obtaining that second mortgage with a low interest rate.

However, there are some things that you can do which will increase your chances of getting that second mortgage, it is just a case of knowing where to look.

As a result, the bad credit mortgage market is expanding, and is competitive, which means that customers suffering from poor credit can find a range of mortgage products that suit their needs and that help them get their finances back on track.

3 Tips on finding the best bad credit second mortgage

1. Borrow as little money as possible in order to keep your loan-to-value ratio (LTV) to a minimum:

No matter what  your credit score is, second mortgages - a.k.a. home equity loans - will automatically to cost you more money than your first mortgage in terms of the interest you pay. However, by keeping the amount you borrow down to a minimum you can also keep that interest rate to a minimum. The less you borrow, the lower your loan-to-value (LTV) ratio will be.

This LTV for a loan is calculated by taking the total amount borrowed (including first AND second mortgage) and dividing it by the value of  your home, the value is what the lender says it is worth at the time the second mortgage is agreed.

2. Create a list of second mortgage lenders who specialize in working with bad credit individuals:

This is where the work really starts by looking for as many bad credit second mortgage lenders as you can find. Create for yourself a list of at least 3-5 lenders. You most ensure that they are either "bad credit second mortgage lenders" or "bad credit home equity" lenders. These are specialists lenders who know how to look past your credit score, focusing instead on other factors that determine your creditworthiness.

3. Shop aggressively:

This part is probably the part most people fail to do, you must follow through with applying to each and every lender on your list. Then, negotiate aggressively for the best-possible rate. Even in these financial times companies are willing negotiate when they sense that you have other options.

These 3 things will help you secure the best-possible bad credit second mortgage loan.

These tips are also valid if you are looking for mortgages for people with bad credit