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Use Bad Credit Home Loan To Get Funds Despite Poor Credit Ratings
By Agnes Powel
Blemishes appear in the credit rating report when a borrower misses a credit
card payment; defaults on loan installments or doesnt pay his bills
on time. A sharp eye is kept on these events by the credit rating agencies
and they label such a borrower as a bad credit case. This serves as a warning
to prospective lenders. Bad credit people, when they look for loans, often
find it very hard because the lenders are adversely influenced by their
credit rating history. However, if the borrower has a property or
house, which he can offer as collateral for the loan, lenders become more
flexible and underwrite their loans. A bad credit rating home loan becomes
the saving grace for people with bad credit rating.
The most popular use of a bad credit rating home loan is to consolidate
existing debts. In this process many debts with different lenders and nagging
installments are clubbed into a single loan with a single monthly installment.
A bad credit rating home loan is also used to buy a new car, to fund an exotic
cruise, to pay existing credit card debts or to finance any home improvement
plan. A bad credit rating home loan is very convenient way of securing a
large loan, which otherwise would have been very difficult for those with
poor credit rating.
credit rating home loans due to their inherent risk come with a relatively
high interest rate. Depending on how a borrower ranks on the credit rating
scale he can expect typical APR (Annual Percentage Rates) ranging from 9%
to 30%. Since, a bad credit rating home loan uses the house of the borrower
as the collateral it is a secured loan. The repayment term for such a loan
can vary between 5 to 20 years. A borrower can expect sums between £5000
and £50,000. This amount is limited by the value of collateral offered
to the lender and the repayment capacity of the borrower. Taking the credit
rating history into account the lenders feel it safe to give amounts
up to 70% of the collateral value. The monthly installments of such loans
are quite small and easily manageable, so these loans are very popular with
bad credit rating people.
Since the interest rates, property valuation fees, solicitors fees,
conveyance and other office charges can increase the costs of the loan
tremendously, it would be a wise decision if the borrower shops around and
gets the best deal. Heading straight to the first lender who promises a loan
might compromise a borrowers interest in the long run. A bad credit
home loan with low interest rates and minimal fees can save a fortune for
There are online lenders, specializing in bad credit home loans, which have
a good experience in dealing with people with adverse credit ratings.
Sensitive to the concerns of those with a poor credit rating, they often
come up with innovative lending options to incorporate their borrowing
requirements. Gone are the days when applying for a bad credit rating
home loan was a daunting task involving a heap-load of paperwork. Most
of the frontline lenders now have online presence and offer online application
facilities. Filling up of these applications takes a very short period in
fact just minutes and can be done from practically anywhere- the only requirement
is a computer with an internet connection. A toll-free number is also mentioned
on the websites of most of the prestigious lenders. It can be used to apply
for a bad credit home loan. Many lenders offer an in-principle approval for
a bad credit home loan within 24 hours. Best offers from the choicest lenders
and a hassle free bad credit rating home loan awaits a borrower if
he/she applies to the right online lender.
Agnes Powel is a financial analyst by profession. The academic qualification
of MBA (Finance) from University of Central England matches his credentials.
Years of experience in has given the field of lending him an insight into
the various intricacies of the loans market. Through his articles, he tries
to share this knowledge with the prospective borrowers.To find Mortgage,first
time buyer mortgage,but to let mortgage that best suits your needs visit
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