Bad credit mortgage refinancing options do exist and getting approved is not as hard as many people think. Interest rates are low and Obamas stimulus plan is in effect and helping millions of people. Homeowners in all financial situations are looking to take advantage. Here are some tips that will assist nearly any homeowner who is looking to refinance a home loan and has a bad or shaky credit rating.

Be Realistic
Mortgage interest rates right now are around 5% for a typical 30 year fixed loan. Homeowners with bad credit need to know that they will not be able to get this interest rate for themselves. However, since they are so low, many homeowners, even with bad credit, will be able to get a better interest rate than they have now. While your credit will affect the rate you get, you still may qualify for low enough rates to make refinancing a mortgage beneficial. This means that homeowners with bad credit should expect to pay up to 75% more in interest rates than other people with a better rating.

Choose Wisely
Make sure to choose the correct mortgage lender or bank for your situation. While nearly any lender or bank claims to offer bad credit mortgage refinancing options, many of them are overly expensive with higher than necessary rates and fees. Others have strict eligibility requirements that only a few people will qualify for. People with a bad credit score need to evaluate a variety of different lenders, their fees, and their requirements prior to wasting time or money and applying for a refinancing. People will quickly find that some options may cost them thousands of dollars more for the same thing that is available somewhere else.

It’s the Little Things
The little things in your credit report can add up quickly. Any outstanding debts, past or overdue accounts, and other negative marks all affect your refinancing options. Before you apply, make sure you settle and close as many negative remarks on your credit as you can. Also, close other accounts and cards you have that you do not use. While it may not be the deal breaker, it may get you a lower interest rate and save you a lot more money in the long run.

Many homeowners with a less than perfect credit score are intimidated or already believe that they are not able to get help. The truth though is much different. Help is available from many different places with all sorts of options. However finding and getting approved for that help is up to the individual. These tips will help anyone with bad credit looking to refinance a home mortgage.

-M Petrone

Subscribe via email

Enter your email address:

Delivered by FeedBurner