If you are asking if you can still get a kitchen remodel loan for your home even though you have a bad credit score or poor credit history. The answer is yes. Yes, you are still entitled for a kitchen remodel loan or any kind home improvement loan even if you have a bad or poor credit history. You just need to repair your credit first before you can secure a loan.
Here’s how to do it.
1. Take a look your credit score or history.
You can’t start repairing your credit score if you don’t check your credit report first. Remember that you have the right to get a free copy of your credit report every 12 months. If you haven’t receive your credit report, be sure to get a copy of it and check it for errors.
Your credit report includes all the data used to calculate your credit score and it may contain errors like:
- Identity errors - errors concerning with your identity
- Incorrect reporting of account status - these are errors concerning about the current status of your account.
- Data management errors - these are errors where incorrect information are being used on your credit report.
- Balance errors - errors that concerns about your current balance.
You have to check your credit report for any of these errors. If you find an error on your report, you need to dispute them with the credit bureau. Just make sure to bring all the documents needed to support your claim once you go to a credit bureau. These documents will help confirm the errors on your credit report.
2. Start repairing your credit.
Once you’ve dealt with any errors on your credit report, it’s time that you start repairing your credit. Now, there are three main ways to repair your credit and these are:
- Pay all your payments on time.
- Pay any unpaid or overdue debt.
- Avoid getting new credit until your credit score is back up where it needs to be.
To do these things, you need to make some tough, smart decisions with your budget. You have to make sure that you are not spending more than you earn. You can do this by being smart with your budget like:
- List out your regular monthly expenses like rent or mortgage, car payments, and home, care, and health insurance, and subtract it from your current monthly income.
- Next, list out also all of your other expenses at home like groceries , entertainment, food, and gas expenses.
- After that, you should create a budget limit for each of your expenses based on your income. Say, your family spends $400 a month for groceries, try limiting that to $300 a month.
This way you should be able to pay all your credit payments consistently while not compromising your other expenses at the same time.
3. Make payments on time.
Your bad credit score could be caused by your late credit payments. Know that your payment history affects your credit score more than any factor. It can affect your credit score by up to 35%. Making credit payments on time is the best way to improve your credit score.
This will also help you to be qualified for a home improvement loan like a kitchen remodel loan. Creditors will be looking at how you’ve made your credit payments recently and base their decision to whether give you the loan or not.
You need to repair your credit and your credit report first, before you can be qualified for a kitchen remodel loan or for any kind of loan. Just keep in mind though, that your credit score will not improve overnight. It will take months or, years even, before it starts to climb back up.