Home Refinancing Rates – How to Secure the Lowest Refinancing Rates

admin — Thu, 20 May 2010 18:08:41 +0000

When refinancing your home, you obviously want to secure a lower interest rate than the one attached to your current loan. However, many people make the mistake of not preparing ahead of time before applying for a refinance mortgage loan. In order to secure the lowest home refinancing rates, you should make sure of a few things before applying.

1) Be patient. There are major delays in refinancing loans right now. Many homeowners are applying for refi loans and the lenders are very backed up. Some loans can take as long as six months to go through. Be patient, and don’t get bothered by minor increases in the current rates because once your refi goes through, your rate will most likely be significantly lower than the rate on your old loan.

2) Credit score. Good or even great credit is no longer enough to secure the best home refinancing rates. Today, you need stellar credit. A score of 720 or higher should be good enough to get you the best rates. Check your score constantly and make sure you take all the necessary steps to get and keep your credit score over the 720 mark. Pay down your credit card balances and pay off other loans if possible. Hiring a credit counselor may not be a bad investment if you need the help.

3) You will not be offered the lowest home refinancing interest rates unless you have good equity in your home. You need at least 20% equity. If you don’t have it yet, consider making a large payment to get your balance down low enough to get it. Of course, you need to weigh the loss of liquid assets against the advantages of the low interest rate to decide if this is a good idea financially.

By: Jennifer Lynn Hanson

Bad Credit Mortgage Refinancing – 3 Reasons to Refinance for a Better Rate

admin — Tue, 03 Nov 2009 11:12:44 +0000

Individuals with bad credit often assume that it is impossible to
obtain a refinancing or home equity loan. However, this assumption is false.
Because a new mortgage and home equity loan is protected by your home,
mortgage lenders are more eager to offer money. Do not allow bad credit
to stop you from refinancing. By refinancing your home, you may
actually improve your finances and credit.

Refinance Mortgage Loan for Cash-Out Option

If you are hoping to improve your credit, refinancing your home and
obtaining cash at closing is a great alternative. The money you receive
can be used for any purpose. In most cases, homeowners put the money to
good use and payoff old credit card balances, consumer loans, and past
due accounts. Bad credit is typically the result of paying bills late,
missed payments, excessive debt, and unpaid medical and utility
expenses. If you consolidate and lower your debt-to-income ratio, your credit
score will improve.

Lower Monthly Mortgage Payment

Although bad credit justifies a higher interest rate, if you purchased
your home during a time when interest rates were higher than 9 percent,
a refinance may actually lower your rate. While you may not receive a
prime rate of 5 percent, an interest rate reduction of two or three
points will decrease your mortgage. The money you save can be used to pay
bills, which will ultimately improve your credit rating and score.

Convert Adjustable Rate Mortgage to Fixed Rate Mortgage

The biggest reason for refinancing a home loan is to obtain a fixed
rate mortgage. Initially, many homeowners choose an adjustable rate
mortgage because the rates are lower. However, these mortgage rates have the
tendency to increase or decrease. The consequence of rising interest
rates is a rise in mortgage payments. Because fixed mortgage rates are at
a record low, several homeowners with good and bad credit are locking
in at low rates.

Bad Credit Refinancing Lenders

Traditional mortgage lenders rarely offer refinancing loans to bad
credit applicants. To refinance with poor credit, you will have to obtain a
loan from a sub prime lender. Choosing the best sub prime lender
requires a little effort. If getting the lowest rate is a top priority,
contact several lenders and request online quotes. Review each quote
received, and go with the lender that offers the best refinance package.

By: Carrie Reeder

Bad credit refinancing » Credit Card Balances

Home Refinancing Rates – How to Secure the Lowest Refinancing Rates

Bad Credit Mortgage Refinancing – 3 Reasons to Refinance for a Better Rate