Home equity loans can serve many purposes. You can use them for remodeling or repairing your home, sending your child to college, or to pay off your other debts. Indeed, for people who have lots of credit card or other high-interest debt, a home equity loan can allow you to pay off all your high-interest debt in one fell swoop and then make lower monthly payments to your bank at a much more reasonable interest rate. In order to get the best deal on your home equity loan, it is important to get your finances in order and shop around to compare the deals that you are getting from various lenders.
The first step in getting a home equity loan is to make sure your finances are in order. Make sure that you are caught up on all your bills and check your credit report to make sure that it is accurate. If there are inaccuracies or old information on your credit report, you will want to make sure to have that cleared up as soon as possible. Also, you certainly don’t want an inaccurate credit report to get in the way of getting approved for a loan with agreeable interest rates. Fixing a credit report can take a long time, even if it was no fault of your own. Generally speaking, the faster the problem is caught, the more quickly it can be resolved to your satisfaction. Because of this, you should review your credit report at least once per year just to make sure.
If you do have bad credit, there are lenders out there who will work with you. You can ask your mortgage company or bank for recommendations. You can also look online, but you should be careful when doing that. There are a lot of scam artists on the Internet and people with bad credit who are searching for loans can be easy prey.
Once your finances are in order, it is time to start shopping around. The holder on your mortgage is as good a place to start as any. You can usually get rates quoted over the phone, but no one will be able to give you a firm yes or no and an exact number on interest rates until they have fully analyzed your loan application. Another excellent place to start looking for home equity loans is the place where you do your banking. Often times, bank members get special loan rates and consideration if they have active accounts in good standing with the bank who is signing off on the loan.
You will also want to look at credit unions and other non-profit lending companies for your home equity loan. Non-profit lending agencies generally offer better interest rates because they are not trying to hike up profits to please shareholders or board members. If you’re regular bank is a non-profit or a credit union, which is so much the better for you, as you will probably be eligible for some really good rates.
Online lenders are not just for people with credit issues. Having access to lots of lenders at the click of a mouse for your home equity loan is good news for you. You can shop around and compare from places online and around your town. You can even try to haggle for a lower interest rate, presenting offers from other companies to bolster your case. If you are looking online for either problem-credit or good credit loans, make sure to check with the BBB and the state attorney’s office in the state the company is registered in to check for any potential problems.