Do I Need a Credit Check when Refinancing a Personal Loan?

February 21, 2019

Many people look to refinancing when they feel as though their current form of lending is not fitting in well with their finances. All kinds of loans can be refinanced, including personal loans.

If you are considering refinancing an existing personal loan, one question that may be going through your head is whether you will need a credit check. The short answer to that question is yes, most lenders will require a check credit when refinancing a personal loan.

How a credit check will impact the personal loan refinancing process will vary from one lender to another. Here is more information about credit checks when it comes to refinancing a personal loan and the role that credit plays.

Why Do Personal Loan Lenders Check Credit When Refinancing a Personal Loan?

When looking to refinance, personal loan lenders will look at credit for several reasons, here are a few of the major reasons why they do so:

  1. It will give them an idea of how you’ve handled past debt and how you will handle a new loan.
  2. It will help them figure out your reliability.
  3. It will let them know how much existing debt you have.

When Will a Credit Check Have an Impact on Refinancing a Personal Loan?

Refinancing a loan will involve taking out another loan and transferring the debt from the existing one onto the new one.

When it comes to choosing the new loan, there are two main types to choose from:

  • Secured Loan—This is where the loan is secured with an asset, such as a car or a home.
  • Unsecured Loan—This is where the loan is not secured with an asset.

With secured loans, lenders may or may not perform a credit check. Credit score and credit history will not be a huge factor when determining eligibility for a secured loan because the lender has the security of the asset.

With unsecured loans, lenders will check credit. Credit will play a big part of whether or not a borrower will qualify for the loan.

What Characteristics of The New Loan Should I Look for When Refinancing a Personal Loan?

When looking for a new loan to refinance an existing personal loan, it may be helpful to know what characteristics are considered positive:

  • A lower interest rate
  • A flexible lender who better fits your finances
  • A better suited monthly payment/plan
  • A loan that offers more convenience than the existing one

From the list above, it becomes clear that the main point of refinancing a personal loan, or any loan, is to make the entire process of lending easier and ultimately lower the cost of borrowing funding.

What Kinds of Loans Can Be Used to Refinance a Personal Loan?

There are several kinds of loans that can be used to refinance a personal loan:

  • Another Personal Loan—This is funding that can be used for a variety of reasons, these loans can be either secured or unsecured.
  • Car Title Loan—This is a type of secured loan, where the asset involved is the vehicle. Generally, car title loans are not a great idea for refinancing a loan, because their interest rates tend to be pretty high.
  • Home Equity Loan—This is another type of secured loan where the asset is the borrower’s home.
  • Credit Card—These can be either secured or unsecured types of lending.
  • Payday Loan—These are loans that are secured from the borrower’s paycheck.

Do I Need Good Credit when Refinancing a Personal Loan?

In order to refinance an existing personal loan, a borrower does not necessarily have to have good credit. But if you are someone looking to refinance with poor credit, it is extremely important to find a lender willing to offer you a competitive interest rate despite low credit. One way to find that is to look at several lenders for different kinds of loans.

This where MaxCash may be able to help, instead of being a lender ourselves, we work with several reputable lenders across the nation. Our job is to be the middle-man between a potential borrower and potential lender, and to educate those who are looking for funding.

We deal with all kinds of lending, including personal loan refinancing. To see if you qualify for the personal loan refinance process through us, start by giving us a call at 1-833-207-9052 or sending us an email at info@maxcash.com.

With any kind of lending, a person may want to change things up after borrowing, this is where loan refinancing comes in. This process may be done for all kinds of lending including personal loans. When refinancing a personal loan, a credit check will be part of the application process, but it does not always have to part of the eligibility process.

DISCLAIMER:
The MaxCash website does not offer or provide loans, but rather, it offers a service. It should not be construed as a lending agent or broker. The site does not endorse any lenders and does not charge visitors any fees. The website owners do not evaluate potential lenders’ applications, nor do they approve or deny credit. The MaxCash website does gather applicants’ personal information and transmits it to lenders that are part of the site’s lending network. No one is required to make use of this website, nor are they under any obligation to begin contact with site operators or to attempt to secure a loan with any of the site’s lending partners. Transmission of your financial and personal information on the website in no way obligates lenders to offer you a loan or any other kind of credit product. Be aware that cash transfer times can vary, depending on the lender and the bank you use. It may be necessary to fax information under certain circumstances. All questions about loans, and any concerns you may have should be directed to your lender. These loans are intended as short-term financial solution to satisfy borrowers’ needs for immediate monetary relief. This is not intended to be part of a long-term financial plan for individuals. These services are not offered in all states. Potential borrows may undergo credit check if lenders choose to use any of the major credit reporting bureaus, including Equifax, Trans Union and Experian. They may also use other alternative sources to check credit ratings. Your request for a loan constitutes your agreement and acknowledgement that (A) your personal data may be shared with lenders and perhaps other third-party partners, and (B) lenders can acquire credit bureau reports that detail your credit history. Reports from major credit bureaus, such as Equifax, Experian and TransUnion may be obtained and used to evaluate your reliability as a borrower.

1Loan amounts by the lenders vary based on qualifications.

2Since we do not lend money directly we cannot offer you a solicitation for a loan. In all serviced states we WILL match you with a lender based on the information you provide on this website. We will not charge you for this service and our service is not available in all states. States that are serviced by this Web Site may change from time to time and without notice. Personal Unsecured Loans are not available in all states and all areas.

3Loans such as, Auto Title Loan companies typically do not have pre-payment penalties, but we cannot guarantee that every lender meets this standard. Small Business Loans typically do have pre-payment penalties and occasionally will use your car as collateral to secure the loan. Other types of loans may have pre-payment penalties as well.

4All lenders are responsible for their own interest rates and payment terms. Max Cash has no control over these rates or payments. Use of the work competitive or reasonable does not mean affordable and borrowers should use their own discretion when working directly with the lender.

5The amount of people who applied for a loan and we helped and those who received a loan is not the same. We cannot guarantee we will find a lender who will fund you. Just because you give us information on this web site, in no way do we guarantee you will be approved for a car title loan or any other type of loan. Not all lenders can provide loan amounts you may see on this web site because loan amounts are limited by state law and/or the lender. Some lenders may require you to use a GPS locator device on your car, active all the time, in the circumstance for an auto title loan. They may or may not pay for this or charge you for this. This is up to the lender and we have no control over this policy of the lender. Typically, larger loans or higher risk loans use a GPS.

In some circumstances faxing may be required. Use of your cell phone to receive updates is optional. Please review our privacy policy.

Loans such as Car Title Loans are expensive and you may have other ways to get funding that is less expensive. These types of loans are meant to provide you with short term financing to solve immediate cash needs and should not be considered a long-term solution. Residents of some states may not be eligible for a loan. Rejections for loans are not disclosed to our firm and you may want to contact the lender directly.

Signature and personal loans are only available in Georgia and Florida. Loan amounts differ at locations. Account approval requires satisfaction of all loan eligibility requirements, including a credit inquiry, and, if applicable, motor vehicle appraisal.

Car Title Loan lenders are usually licensed by the State in which you reside. You should consult directly with these regulatory agencies to make sure your lender is licensed and in compliance. These agencies are there to protect you and we advise making sure any lender you receive money from is fully licensed.

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