Qualify For Better Than A Bad Credit Home Equity Loan
One of the best ways to borrow money if you have poor credit is with a bad credit home equity loan. Many lenders will consider loaning money to you on that basis that would not touch you with any other type of loan. Just be prepared to pay more interest on the loan than someone with good credit would pay for the same loan.
Persons having bad credit can often improve their credit score just by knowing a few tricks that often help. These tricks begin by obtaining a copy of each credit report that lender can order.
The Fair Credit Reporting Act requires that each agency that collects credit information about you provide annually a credit report for you to review. Additionally, you qualify for another free report if you are turned down for a loan based on that report.
Once you obtain and review these records look closely for any inaccuracies being reported. In addition, a bad debt can only affect your report for seven years after it went delinquent. If any debts are beyond the seven year mark, you should ask that they be removed from your credit report. Make all requests by certified mail. You will also need to pay for a return receipt. This procedure will cost about five dollars, but is a necessary part of the process.
Next, you can begin to work on those debts that are beyond the statute of limitations for your state, but less than seven years of age. Begin by writing a letter of dispute to the company that has reported the debt to the credit reporting agency. By law they have thirty days to investigate the debt and either send you confirmation that the debt is yours or have it removed from your credit report. If it is beyond the statute of limitations for your state, they cannot sue you in court for the money, so many will simply revise the report and the bad debt falls off of your credit report.
When you send the letter to the collection agency, also send one to the credit reporting agency. Ask for an investigation of the same debts. They must by law contact the collector and investigate the debt. If the creditor does not return the inquiry, then the debt must be dropped from your report. This often works to your advantage.
As mentioned earlier, the cost of certified mail and the return receipt is small compared to the amount of money this may save you in interest charges on your loan.
Many times these two letters are all that are needed to change a bad credit report into a decent one. In a matter of just a few months you may qualify for a much better interest rate on your home equity loan than if you had only qualified for the bad credit home equity loan. It is certainly worth a try if you have the time. The work can save you several hundred dollars over the life of a home equity loan.
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