Bad Credit: Options for Refinancing a Mortgage

Like many people, the recession hit me pretty hard. Thanks to a job loss, I got behind on some of my credit cards. Even though I did mange to make the mortgage payment every month, my credit rating nose-dived. While things did get better, I still wondered if it would be possible to refinance my mortgage with bad credit. After talking with a few lenders, I found out that my situation was not unique. I also found lenders who were willing to work with me. I managed to get terms that will save me money over the life of that mortgage. If your credit has taken a beating, don't assume that refinancing is out of the question. I'll share how I researched options and found a lender who offered a good deal. You could find that refinancing your mortgage is within your reach.

The Effects An Auto Loan Can Have On Your Credit

Finance & Money Blog

If you are looking for ways to improve your credit score and need a new car, did you know that getting an auto loan could have some really good effects on your credit score? A lot of people think they should wait to get a loan until their credit improves, but this is really not true. No matter what credit score you currently have, you can probably still qualify for a loan at this time, and you should know that getting a loan may help your score in more ways than you know.

It may improve your credit mix

One of the factors that affect your credit score is called a credit mix, and this refers to the mixture of the types of loans and credit lines you have on your report. If you currently have only a few credit cards on your credit report, adding a car loan will help your credit mix. When you have a good credit mix, it can improve your credit score, which means you could instantly see a small increase in your score just from getting an auto loan.

It offers a way to build repayment history

Secondly, getting an auto loan gives you the perfect opportunity to build a positive repayment history, and this is vital for your credit score. Repayment history makes up 35% of your credit score, which is a big chunk. If you get an auto loan that has 36 payments, for example, you will have 36 chances to show that you pay your bills. Each time you make a payment and your lender posts it to the credit bureaus, it will slowly build up a positive repayment history. This will show that you pay your bills, and this means that creditors are likely to view you as a person who is creditworthy.

It adds new credit

Adding a new credit account on your report may cause the score to drop a little bit at first, but this is temporary. After a month or two, your score should increase back to where it was or even higher, simply because adding a new credit line can often cause a person's score to go up.

If you think you will not qualify for an auto loan at this time, you may want to try to get one anyhow. Not only might you get approved for the loan, but auto loans can also help you with your credit.


21 September 2019