Considering refinancing? There are so many alternatives, how to pick the right one? We have gathered the most useful and up to date information for choosing the right refinancing option for you. We hope this site proves useful for you in your quest! Don't forget to bookmark us!

Refinance Tips for Increasing Your Credit Score: Equity Loan Advice for Getting Low Rates

by Dana Jagodnik

Your credit score, based on your credit report, basically shows lenders the likelihood that you will repay what you owe. The higher your credit score the easier it is for you to qualify for loans and the better the interest rate you will be offered. However, if your credit is not so perfect, there are ways to improve your score. One option available to you, which can rebuild your credit is to do a refinance. Refinancing with a home equity loan will allow you to pay off those high balances and high interest accounts that have a negative impact on your credit history. Consolidating debt is the closest thing to starting from scratch and can often be a better move than creating new accounts and adding more debt to your history.

Your payment history is one of the most important factors of your credit score. Lenders will look to see that payments are being made on time, that you’re making at least your minimum monthly payments, and are not missing payments. Through the course of a

refinance it can be a good idea to pay off accounts with late payments, bankruptcies, or collections to improve your fico score.

Lenders also look to see that your credit limits are not maxed-out. Avoid carrying a balance that are more than 80% of your credit limit because creditors may view your high balances as excessive debt that you may not be able to stay current with. Therefore, during the course of a refinance it’s a good idea to pay down and consolidate any debt that you can. The smaller the balances you keep the more it will reflect positively on your credit score.

After you have finished your refinance your work is still not done. You might have consolidated all your debt into your mortgage but your mortgage and other payments still have to be made. Make sure to make regular and timely payments to any creditors that you have left. This is especially important for you mortgage, which is probably one of the most highly weighted parts of your credit history.

It

takes some time for your new credit history to gain momentum. With patience and timely repayments, you will likely be able to build a new credit history that creditors will look upon favorably when making decisions about your ability to handle even more credit. Make sure to apply for new credit sparingly. Shopping around for credit can have an adverse affect on your score, especially during the course of a refinance. Each time you apply for new credit and that company checks your report, an inquiry is added to your credit file. Too many inquiries can be seen as an indication that you have had trouble getting new credit or could be overextending yourself.

Don't close unused credit card accounts near loan time. If you have several credit card accounts but are only using a few of them, you'll only raise your balance-to-limit ratio if you close the unused ones. You also shouldn't open new accounts when applying for a loan if possible. If you have a short credit history or very few

accounts, opening a new credit line may lower your score since you don't have a proven track record. What's more, a new account will lower the average age of your accounts, another factor in your credit score. Lenders will often look for 3 established trade lines to see that you can manage your credit and pay accounts off in a timely manner.

Dana has written many mortgage and real estate articles over the years. You can read more mortgage related loan articles at Mortgage Refinance & Debt Consolidation and learn more about refinancing equity loans even if you have less than perfect credit.

To get more free 2nd mortgage & refinance tips, please visit Bad Credit Second Mortgages. More credit resources can be seen at National Credit Score Index.

Related Articles

3 Things To Watch Out For With A Cash Out Refinance Mortgage Loan
A cash out refinance mortgage loan is a great option if you have accrued a lot of equity in your home. If you owe $75,000 on a home that is worth $125,000, you could refinance the amount you owe and take up to $50,000 in a cash loan against the...read more

Adverse Credit Remortgage: Refinance at Better Terms
Getting a remortgage with adverse credit is a daunting task and it is increasingly becoming a widespread problem in UK. An adverse credit remortgage is a type of mortgage, which is particularly used by people who have adverse remarks in their credit...read more

Bad Credit Refinance 101: The Hows and The Whats
If you are like every other home owner or general consumer out there, you need to pay for your expenses somehow. If you have bad credit, you might be limited in your options as to what you can do (or so you think…keep reading!). This can be...read more

Deciding Upon a Refinance Lender
Finding a good lender to refinance your mortgage can be almost as important a decision as the actual mortgage you choose. In order to make a wise selection of a refinancing lender you should make sure that you do the following four things. ...read more

RV Financing - For Your New, Used or Refinanced Recreational Vehicle
With any type of RV financing, what most people are concerned about is getting the best possible loan for their budget. Unfortunately, most people are also not sure how to go about getting the best RV financing. This is why it is so important...read more

Take Easy Refinance Bankruptcy Car Loan without Hurdles
You had bought a car few years back and have been paying loan of higher interest rate on the car. Now the interest rate has fallen considerably and you wish to take advantage of it and want to opt for refinancing which allows having a fresh loan at...read more

Why should I refinance?
If you bought your home a few years back when annual interest rates were 12 percent, refinancing now can save you a great deal of money over the term of the mortgage. Or you might be able to switch from a 30-year mortgage to a 15-year, so you can...read more

Need more information? Try a search:

Google