How do I get a home equity loan with bad credit?

You also need to have sufficient equity built up in your home, especially if you’re attempting to secure a home equity loan with bad credit. Lenders use what’s called a loan-to-value (LTV) ratio that divides your current mortgage balance against your home’s current appraised value.

What is a bad credit score for a home equity loan?

A credit score of 580 to 669 is considered fair, while a score below 580 is poor, according to FICO, the most commonly used credit scoring model in the US. For the purpose of this guide, we’ll call a bad credit score one that’s below 670. Having bad credit could make it tough to qualify for a home equity loan, but not impossible.

Can you get a guaranteed home equity loan if you have bad credit?

Given that you’re already a client, that lender may offer a more appealing rate. However, there is no such thing as a guaranteed home equity loan if you have bad credit, so it’s wise to shop around. By obtaining multiple quotes, you’ll be in a better position to negotiate the best possible rate.