By Marie-Claire Smith

Do you need cash in order to pay down some outstanding bills or to pay for an unexpected expense, such as a trip or a medical emergency?

If you are a homeowner, you may be in luck. For homeowners, there are two ways you can leverage the equity you have in your home in order to get the cash you need. The first way is to take out a second mortgage loan. The second way is to refinance your home.

What if you have a bad credit score? No worries: since you will be using the equity in your home as a form of loan collateral, you can still qualify for reasonable second mortgage loan interest rates – even with a low credit score.

If you are trying to decide between bad credit second mortgage loans and home refinancing, here are 5 FAQs that can help:

1. What is the difference between second mortgage loans and home refinancing?

A: A second mortgage loan – also known as a home equity loan – involves leaving your existing first mortgage alone. Instead, you are just taking out an additional mortgage, usually at a higher interest rate than you have with your first mortgage.

On the other hand, with a home refinancing loan, you are paying off any existing first and/or second mortgages with a new mortgage loan. And if you need extra cash in the process, you just take out a larger loan than what you currently owe on your home now. You end up with a larger loan principal and possibly slightly higher monthly payments, but you will have the cash you need.

2. Which type of loan is easier to qualify for if I have a bad credit score?

A: Both types of loans are easy to qualify for if you have a bad credit score. In both cases, the lender will look at several factors, including your credit score, the total amount of your outstanding (first and/or second) mortgage principal, and the current market value of your home.

3. Which option will allow me to get more cash in hand?

A: Both loans turn out about the same in this regard. Whether looking for a second mortgage or a home refinance, keep in mind that each lender will offer a certain loan-to-value (LTV) type loan. For example, an 80% LTV loan means that you will be able to borrow up to 80% of the total equity in your home. The higher the LTV, the more you can borrow.

4. Which option is lower cost to me in the long run?

A: Refinancing your existing home loan may be less costly, since it gives you the opportunity to possibly qualify for a lower interest rate than you have on your existing first mortgage. The result could be an overall lower cost of loan, which would save you more money in the long run.

5. Which option is faster?

A: Taking out a second mortgage (a home equity loan) is probably the fastest route for you to take because doing so does not involve your having to shop for a completely new first mortgage. In most cases, qualifying for a second mortgage loan takes less than an afternoon.

Bonus tip: if you have a bad credit score, be sure to shop for “bad credit second mortgage lenders” or “bad credit home equity loan lenders.” These are the ones that are most likely to approve your loan, despite your low credit score.

About the Author: Find more tips on how to qualify for a bad credit second mortgage loan at:

Bad Credit Second Mortgage Approval

.

Source:

isnare.com

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A Borrower\’s Perspective on Car Loans in India

by

Pritam Bhalgat

One of the greatest joys of present day India happens to be the sheer range of vehicles available for sale. From the cheapest car in the world (proudly made by a home grown manufacturer) to some of the most exotic of wheels to ever be produced on the face of the planet, they are all available here.

But there s more to this automobile rainbow than just that and irrespective of one s cravings being worth a few lakhs to a few hundred lakhs, the car loan finance sector is helping many a fellow countryman (and woman) to live their dream. But no two offerings are the same and just like the automobiles themselves, there are a large number of service providers offering to help prospective buyers.

• The usage of EMI (Equated Monthly Installments) may have hit an all-time high in recent years but a recent trick that s been unearthed by a few alert buyers could turn things on their head. Financers generally tend to go by the on-road pricing of a vehicle when processing applications for car loans. Now, the on-road price is computed by taking the ex-showroom cost and then adding on the various taxes and levies. However, a few unscrupulous dealers have resorted to jacking up the ex-showroom cost since the higher this is, the higher the loan amount would be sanctioned, thereby benefiting them in the end.
• This is why; it is not only important to fall for the attractive car loan rates being offered by the lender but also to pay closer attention to the finer aspects in-order to bagging the best deal out there. Comparing quotes is a no-brainer here, considering just how tough the competition is. This has led to it turning into a borrower s market of sorts and people simply must know where to ask and how.
• Irrespective of the amount being financed, the owner to be is still expected to fork out a certain amount in down payment. Now remember the earlier ex-showroom cost being variable, well, the down payment too is linked to it. Consequently, if one must get away with paying a lower amount, then they must watch the dealer mark-ups closely.
• If one has a pre-existing home loan or a business related loan from a particular lender, then it might be worth the time to ring them up and check if they would be willing to bank-roll your automobile dream as well. Chances are, if such a deal can be worked out, it would turn out to be on considerably favorable terms. This is because lenders usually have to pay for acquisition costs or the charges for each lead generated; which, in the case of pre-existing customers is negligible.

Come what may though, there is no escaping the fact that details are where the gremlins could be lying in wait. So no matter how enticing those lending rates or the friendliness of the man at the vendor s gates, please do go through everything with a level headed mind. In the end it is a dream that is being brought to life and special moments such as these, are best left unspoilt by people of dubious means.

Pritam is a young professional working for an upcoming automobile dealership. He shall be heading the team at the

car loans

division and comes with years of experience garnered from working with some of the top lending institutions in the country.

Article Source:

ArticleRich.com