BD Nationwide can match borrowers looking for second chance loans with subprime mortgage refinancing, hard money, FHA and home equity programs designed for consumers with credit problems. Since originating second chance loans 12 years ago, credit solutions have always been a priority. Whether you are looking for second chance home loans or bad credit HELOCs, we can help you find the loan you need quickly. Take advantage of our two decades of experience working with proven 2nd chance mortgage companies.
What Is a Second Chance Loan?
A second chance loan can be a mortgage or personal loan created specifically for borrowers with bad credit who may not qualify for a traditional bank loans. Unlike payday loans, second chance loans are amortized with fixed monthly installments that make them easier to manage. These emergency loans operate like home equity and personal loans, so you do not need to repay the full loan balance immediately; instead, you can spread the payments over time. We have seen a surge in popularity with second chance installment loans for debt consolidation and emergency funds.
To qualify for a second chance loan, applicants generally need to demonstrate steady income and already have an established bank account. These bad credit loans are also ideal for individuals with no credit history or those who haven’t previously established credit with other direct lenders.
Second Chance Loans and Mortgages with Poor and Fair Credit
We have always aligned applicants with mortgage lenders that provide finance programs with affordable second chance mortgage financing for consumers that have a history of low credit scores or bad debt.
We understand the growing demand of alternative finance programs as millions of American borrowers do not qualify for the traditional loan programs offered by Fannie Mae and Freddie Mac. Fannie and Freddie simply do not offer 2nd chance loans for bad credit. Get help finding lenders that offer a wide variety of non-conforming second chance home loans for buying and refinancing residential real estate in all 50 states. BD Nationwide will match you with lenders providing the best second chance loans online.
Learn More About 2nd Chance Loans for All Types of Borrowers.
We Believe there is More to You than a Credit Score.
Our team members always make every effort to get you approved for a mortgage that makes the most sense for you financially.
Many applicants have turned to us after being rejected from multiple banks and finance companies.
Our second chance mortgage lenders understand the difficulties in finding a loan program if your credit scores are low or your house is underwater with a mortgage that is greater than your property’s value.
Our lending affiliates offer several different programs for borrowers with low fico score or who lack equity needed to qualify for traditional loans. Get a free no credit check loan quote today with a great rate and discounted lender costs.
Second chance loans provide a new opportunity for consumers to reduce their housing expenses with lower interest rates and discounted monthly payments. Many of our clients have been able to consolidate debt and reestablish their credit at the same time. With so many applicants being turned away from banks and credit unions these days, it is imperative to have alternative home financing for good borrowers who just don’t happen to fit perfectly within a guideline matrix. Now is a great time to shop and compare quotes for competitive pricing and terms for subprime and last chance loan programs.
What Are the Top Second Chance Mortgage Refinance Programs?
There are many second chance mortgage refinance programs for qualified homeowners. Of course, these programs highlight easy credit and forgiving lending requirements. When looking for a second chance mortgage refinance, most lenders will expect you to have more equity to compensate for the poor credit ratings.
- Bad Credit Refinance Mortgage – Refinance your first mortgage even if you have low credit scores.
- Bad Credit HELOC – Take out a home equity line of credit to borrow and reborrow for cash out.
- Hard Money Second Mortgage – Private lenders offer hard money loans to borrowers that do not meet conventional lending standards.
Second Chance Mortgage Financing for Bad Credit and Underwater Loans
Millions of Americans need 2nd Chance Loans because of credit problems in their past. Many people also lost equity in their house during the recent housing crisis. Many homeowners found themselves stuck in an underwater mortgage. Many of participating lenders offer 2nd chance loans for bad credit with solutions for upside-down refinancing with the harp 2.0 and the streamline.
We provide consumers with info on 15 and 30-year terms with most of the subprime and FHA insured programs offered by competitive lending companies. We have been matching people with companies offering help to borrowers that need a jumbo or high balance mortgage as well. The second chance mortgage rates are great and our requirements are more flexible than ever before.
Also see these other popular last chance loan programs for borrowers with less than perfect credit.
FHA Loans for Bad Credit | Poor Credit Home Loans | Bad Credit Home Equity Loans
FHA Offers Second Chance Mortgage Loans for People With a Foreclosure
The simple truth is that there are a lot of people out there who have a credit history that is less than perfect. When the financial crisis hit a few short years ago, there were very few people that weren’t affected in at least some way. Many individuals lost their homes because of predatory lending practices or subprime loans that ballooned out of control and left them with a mortgage payment that they simply could not afford.
Other people may have found that the flood of foreclosed properties in their area cause their own home value to drop, making it difficult to sell a property that they were no longer interested in keeping. Apply for a FHA mortgage with no application fees.
New Financing Opportunities with the FHA
With a wide variety of different situations out there, it is good to know that there is a second chance home loan for individuals who have a foreclosure or other credit problem in their recent history. While not everyone will qualify, there are a surprising number of options available for individuals who feel that the time is right to go about purchasing a new home. Read more about FHA Mortgages for People with a Poor Credit History.
A new initiative known as the “Back To Work Program” from the FHA is designed to help borrowers who have had recent problems with their mortgage. Specifically, this program is designed to help individuals who suffered problems because of an economic issue that was beyond their control. In order to qualify for this program, an individual must have been involved in one of the following events:
- Forbearance agreement
- Loan modification
- Chapter 7 bankruptcy
- Chapter 13 bankruptcy
- Foreclosure
- Short sale
- Pre-foreclosure sale
An individual that is able to provide proper documentation of a 20% drop in their income will then be required to go through a counseling session that lasts about one hour before essentially being forgiven of their history by the FHA. The Federal Housing Administration even offers a cash-out refinance with bad credit if the borrower can stay under 85% CLTV after receiving the money back.
Second Chance Mortgage Loans for Homeowners with Damaged Credit
Your credit score has a tremendous impact on a huge number of things throughout your life. Even those who have already purchased a home may end up struggling with certain things due to bad credit – especially if they are trying to secure a refinance loan or a line of home equity. If you want to consolidate credit card debt, consider a home equity loan for debt consolidation.
Your home is a key source of collateral and equity, but the reality is that poor credit can keep you from getting the kind of loans that others are able to secure. However, you do have options and it’s worth remembering that if you put forth the right amount of effort you should be able to track down a loan that will fit your needs – even if your credit has been damaged in the past.
Understanding Your Options on Second Chance Loans
The first step is simply to figure out just what options you have. There are several types of second chance home financing that can help here, but two primary choices stand out:
- Finding Subprime Lending Sources – There are non QM lenders and brokers that offer home loans, refinancing, and bad credit 2nd mortgages to subprime borrowers. These are borrowers who have a less than stellar credit score, and their lower or damaged credit means that they are a higher risk of defaulting. As such, these loans come with different terms than traditional ones.
- Government Loans – The government insures certain second chance mortgage loans as well. Things like HARP or FHA loans are backed by the government and are designed specifically for those with poor credit. They’re often a good place to start for those looking to refinance but who have damaged credit scores.
These two options are great starting points and could be exactly what is needed for homeowners hoping to refinance or secure additional cash through their home equity but whose damaged credit has made it difficult in the past.
While second chance loans can offer financial relief, borrowers should be aware of common characteristics associated with these high risk loans before committing and signing documents. In most cases, these second chance loans with bad credit can be costly. The terms of 2nd-chance loans may result in an increase in the borrower’s overall debt over time.
Fixed vs Adjustable Rate Mortgages
One of the most popular second chance loan types is an adjustable-rate mortgage, also known as a ARM. This variable rate mortgage is popular with individuals with bad credit and features a short-term fixed interest rate. During the initial period, typically the first three or fiver years of a thirty-year mortgage, monthly payments remain consistent.
The fixed-rate aspect provides a predictable monthly payment, aiding the borrower in rebuilding their credit. However, once this period concludes, the second chance loan’s interest rate becomes variable, responding to fluctuations in the broader financial market, akin to the rise and fall of stock prices. With monthly payments subject to change, the loan can become financially burdensome.
Things to Consider When Researching Second Chance Mortgage Loans
While it’s true that you can secure a refinance loan or equity type of second chance loan from various lenders while still having damaged credit, there are a few things you’ll want to keep in mind here as you start the process.
- With low credit, other variables come into play. Things like your income level, debt to income ratio, and even the amount of time you’ve been at your current job will play larger roles in securing and qualifying for a loan of this nature. You can’t just walk into any bank or credit union and find second chance loans guaranteed approval.
- You will also likely need a higher amount of equity within your home in order to qualify for the right loan. You’ll need more equity the lower your credit score is in order to offset the risks that these lenders take by offering you the loan.
- Finally, remember that your interest rate will usually be much higher than in a traditional loan. Again, the increased risk your poor credit history will show means that lenders will offset that risk in several ways – most notably with a high credit score.
Tips to Increase Your Chances of Mortgage Approval with Limited Credit
Even with programs such as FHA, you will have a harder time getting approved with limited credit history. Some of the things you can do to enhance your odds to being approved for a second chance loan:
- Put down a larger down payment. Money always talks in the mortgage business. If you can put a 20% down payment on your home, you can increase the odds of approval regardless of your credit history. People with a larger financial stake in the home are less likely to default, and lenders know this.
- Increase your cash reserves. If lenders see that you have five or six months of mortgage payments saved, it is more likely they will approve you for a 2nd chance loan.
- Keep a steady job. Being approved for your loan is about credit, but your income is a big deal too. The lender needs to see that you are stable financially and job wise. This is more important with a limited credit history. You should be able to show the lender that you have steady employment and are not regularly changing jobs. A good rule of thumb is to have been at least in the same industry for the last two years. Ideally, you should have been in the same job for the last two years as well.
Many second chance loan lenders provide the option to check for loan pre-qualification, especially if you haven’t found a mortgage company yet but wish to estimate the loan amount and potential interest rate. Pre-qualification typically involves a credit inquiry, but if you are serious about getting approved, the brokers or lenders will have to pull your credit report at some point.
Simply put, you do have options for getting a second chance loan as a homeowner when you have poor credit. Understanding everything above is the first step towards getting the cash that you need.
BD Nationwide will connect you with competitive mortgage lenders that offer second chance loans with bad credit and there is no application fee or obligation.