People in the market for mortgage loans, refinancing, or home equity loans often have problems getting approved due to a poor credit history. But these challenges are not necessarily insurmountable. If you're in this situation and find yourself in need of a mortgage or home equity line of credit, there are options available to you.

Repair your credit with a home equity loan

If you have an unpaid lien on your house and it's playing such havoc with your credit rating that you can't qualify for a home equity loan, help can be found. Many lenders welcome the chance to do business with people in your situation. They can provide you with money to pay off that pesky lien by using your house as collateral. If you have equity in your property, you can tap into it through refinancing or by taking out a home equity loan to clean up your credit.

Sub-prime lenders specialize in you

It might surprise you to learn that there's an entire industry based on lending to people who have bad credit. If you fall into this category, you're a higher risk to pay the money back. As a result, "sub-prime" lenders will likely charge you higher fees, interest rates, or both. But if you can't get a loan anywhere else, the sub-prime market can be a godsend. And once you get back on your feet and pay off your debts, you can refinance to a loan with a better rate.

Help from the government

The guidelines for FHA and VA loans care more about your ability to repay the loan, as opposed to your past credit history. They know that if you can lower your interest rate with a mortgage refinance, you'll have an easier time making your lower monthly payments. If you can gain access to one of these loans, you may be in luck.

One last thought. Many homeowners overlook the possibility that their credit isn't as bad as they'd thought. Many loan officers can be creative in how they interpret your assets, for example, and can creatively make an exception to the normal rules. Before you throw in the towel, check out your options. You might be pleasantly surprised how the right towel can clean up your credit blemishes.