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Where do you get the money for a major home repair when you don't have any credit?

molly2525 - 2009-10-11 15:22:13 - Credit

Our gas-powered steam boiler just conked out and it is getting cold where we live. We desperately (and quickly) need a new boiler and have been quoted $6000 as the cost for the boiler and installation. I have great credit, but no job (I'm 34 weeks pregnant), and my husband has a great job with a reasonable income, but no credit history. We've tried several times in the past few months to get either a credit card or home loan, but no one is willing to give us either (the loan for the home is in my mom's name, but we make the mortgage payment, the purpose for the home loan is to get the mortgage put into our name). How on earth can we come up with $6000 quickly to get our heat going before it gets bitterly cold and we have a newborn to worry about? I haven't tried a personal loan yet at my credit union, would they be more likely than a chain bank to give us a personal loan in this situation, where it's an emergency? The problem is that my husband has no credit, not bad credit. We have applied jointly for two different credit cards and two different home loans in the past three or four months, we were turned down everywhere we went.

Best Answer:

I think that you are going to have to move in with your mother until you have saved up enough money to pay for the new boiler.

Answers:

Is the problem you have no credit or bad credit? It is easier to get credit if it's just a matter of no credit history. Much more difficult to overcome bad credit. If you have the good credit and your husband has the income, you should be able to apply jointly for the loan. You may not get a very good interest rate. Your credit union would definitely be the best place to try for a loan. They are more likely to extend credit to you. You could also check with the local utility company. Sometimes they have programs that could help.

in the short term, Mom should apply for a HELOC.

Under no circumstances use a credit card for this type of purchase. You'll get $6000 @ 9% today which is affordable, but in the next few months, that interest rate WILL go up to 19%, 25%, 30%? Then you cannot afford the payments. We had a similar situation in VA. In the late 70s, our electric bill was $200 for a 900 sq apartment (total electric with resistance heating). In those days, that was EXPENSIVE! I'm paying that now on a 2400 sq ft total electric home. We closed off most of the apartment and stayed in one room, it was that bad. I think you would do better at the credit union if you have some collateral to help with security of the loan. It's too late now, but consider putting about $25-$50 a month into savings. That will help secure a loan in an emergency like this or even be able to pay cash up front in the future.

I think that you are going to have to move in with your mother until you have saved up enough money to pay for the new boiler.