If you have been avoiding mortgage refinancing because of your credit, there are a number of reasons you should refinance despite your credit rating. Your mortgage is an excellent tool for rebuilding your credit, it can even save you money and free up cash in your budget. Here are several tips to help you decide if bad credit mortgage refinancing is right for you.
Mortgage refinancing has the potential to save you a lot of money if done correctly. Bad credit will not prevent you from refinancing your mortgage; however, how much you pay for the new loan depends on how much time you can afford to invest researching mortgage lenders and their loan programs.
Bad Credit Mortgage Refinancing: Consider Using a Mortgage Broker
If you don’t have the time to properly research bad credit mortgage loans, mortgage brokers can be excellent resources for finding specialty lenders. You have to watch the broker like a hawk to avoid overpaying and understand how the broker makes their money. With that said, mortgage brokers have connections with bad credit lenders and could easily place you with a competitive loan offer.
Bad Credit Mortgage Refinancing: Be Prepared to Pay More
When refinancing your mortgage with poor credit you can expect to pay a higher interest rate and possibly a point or two for mortgage refinancing. You can minimize this expense by comparison shopping for the best bad credit mortgage offer. When you compare loan offers it is important to compare all aspects of the loans and not get hung up solely on interest rates. Depending on how severe your credit problems are, you may need to seek bad credit mortgage refinancing from a Sub Prime mortgage lender. Sub Prime lenders specialize in mortgages for homeowners with credit problems. If you invest the time doing your homework and researching Sub Prime lenders, it is possible to qualify for rates and fees comparable to those paid by homeowners with good credit.
Bad Credit Mortgage Refinancing: What You Need to Do First
The first thing you should do before considering bad credit mortgage refinancing it to review your credit history for errors. Credit records are maintained by three separate reporting agencies and with dozens of creditors accessing your file throughout the year; these records are extremely error prone. Having errors in your credit reports will significantly reduce your credit score. Your credit score is one of the main factors lenders use when determining what interest rate you qualify for. If you find errors in your credit history you will need to dispute the error prior to refinancing.
You can learn more about bad credit mortgage refinancing without overpaying and making costly mistakes by registering for a free mortgage guidebook.
To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid costly mortgage mistakes and predatory lenders. For a free copy of "Mortgage Refinancing - What You Need to Know," which teaches strategies to find the best mortgage and save thousands of dollars in the process, visit Refiadvisor.com.
Claim your free mortgage refinance information guide today at: http://www.refiadvisor.com
