Bad credit refinancing » Home Loans

Should I Refinance My Mortgage Loan Now?

admin — Sun, 06 Jun 2010 05:24:10 +0000

You’ve probably heard a lot about mortgage refinancing on the news lately. In fact, if you’re a homeowner you’ve probably received a few offers in the mail from lenders as well.

The reason you hear so much about this topic lately has a lot to do with the mortgage / foreclosure crisis we are seeing right now. Many homeowners are in situations similar to those they have heard about on the news, having an adjustable rate mortgage set to adjust in the near future … and facing a possible spike in mortgage payments as a result. So, these homeowners naturally look into refinancing as a way to avoid such payment hikes.

The question is — when should you refinance your mortgage loan, and when should you avoid it? This question is high on the list of many homeowners, so I will do my best to shed some light on the subject.

When Refinancing Makes Sense

There are some general rules you can use to determine whether or not a refi makes sense for your situation. Bear in mind, however, that these are just general rules of thumb. So don’t make any financial decisions based on these “rules” alone. Do some further research into the subject and seek the advice of a financial professional.

With that being said, here’s a basic guide on when to refinance a home loan, from a financial standpoint:

Switching from an ARM to a fixed rate — This is a common reason why homeowners pursue a refi in the first place, especially with all the negative press the adjustable rate mortgage (ARM) loan has been getting lately. Eventually, an ARM will adjust to a higher interest rate that catches a lot of homeowners off guard. So many people use refinancing as a way to move to a more predictable fixed-rate mortgage. Capitalizing on Lower Interest Rates — This is another common reason why people refinance their home loans. When the rates are low, homeowners in certain situations can refi to a lower interest rate, and thus reduce their overall monthly mortgage payment.

The goal of both of these strategies is the same … to either (A) lower the interest rate on the loan, or (B) prevent the interest rate from rising through a mortgage adjustment. In both cases, the goal is to pay less money each month on the mortgage payment.

It’s Not Always a Good Idea

Now is a good time to point out that a mortgage refi is not always a good idea. And I can illustrate this through another rule of thumb: If the money you pay to refinance the loan (closing costs) exceeds the amount of money you save over the term of the new loan (lower interest rates), then it doesn’t make sense to pursue it. After all, nobody wants to pay more than they save in a financial transaction.

The key here is to do the proper research to find out what you would pay, as well as what you would save by refinancing. Once you’ve determined those numbers, you will have a much easier time deciding if a refi is right for you.

By: Brandon Cornett

Home Refinance Stimulus Package – Obama’s Stimulus For Mortgage Refinancing and Loan Modification

admin — Thu, 29 Apr 2010 15:39:41 +0000

Obama’s government has come up with home refinance stimulus package and loan modification programs to help all the needy owners in avoiding foreclosure. This program is designed specifically for all the borrowers who are facing financial hardships as they are not in a condition to repay the loan. The home refinance stimulus package and loan modification would cover as much as 9 million mortgages and the government would spend $75 billion for helping the homeowners.

Obama’s Stimulus Package has 2 main components:

1. Refinance

2. Loan Modification

Let us discuss each one of these components in detail:

1. Home Refinance Stimulus Package

· In this program the two most powerful mortgage lending agencies of the government Fannie Mae and Freddie Mac would refinance the home loans of all the owners who owe much more amount to the bank than the actual value of the house. The only condition for this package is that the mortgage must be a guaranteed one by Fannie Mae and Freddie Mac, and then even if you are strong enough to pay the entire extra amount, you can gain advantage of the program.

· But there is one major condition joined with refinance stimulus package and that is; the offer is only valid for the properties which are used for residential purpose. Any property which is lying like a building and no one is living inside, will not qualify for Obama’s home refinance stimulus package.

2. Loan Modification Stimulus Package

· There have been special incentives that Obama’s government is going to provide to all the lenders for doing loan modification on the existing home loans of the borrowers. According to this program, the homeowners can get rid of foreclosure by getting it done. The main features of this program would be; interest rate would be reduced and it can go down to 2% only, tenure of the loan would be increased to reduce monthly payment amount and borrowers will get waiver of late fees.

· With loan modification, lender will also take care of the total monthly payments that a borrower is making and it would not increase than 31% of the total monthly gross income.

By: Luke Cambell

Bad Credit Home Loan Refinance – the Way to Help You Financially

admin — Fri, 12 Mar 2010 14:19:21 +0000

It is an undeniable fact that recession has ruined the economy worldwide. Let it be the sector of Information Technology or automobiles, every where slower economy has made people seeking for loans. Yes, due to the worst face of inflation, more and more people are looking for the supportive hands to get their financial needs fulfilled. But, is it really possible especially in terms of present market situation? Well, of course it is!

Even many lenders are providing the loans at quite considerable interest rates to the people, who are good at their credit ratings. But, does the same apply for the persons with bad credit? Well, up to some extent. That’s why it is beneficial for such people to look beyond the boundaries and approach bad credit home loan refinance.

As the name shows, these loans are meant to provide financial stability to those who acquired home loans, but couldn’t pay that due to some reasons. Although it sounds something strange to have such kind of loan options available, but tough competition is something which has made it possible. Now, surely, you must be wondering how can it be possible? Well, due to inflation, many people were unable to pay their loan installments timely, but does it mean all of them did the same knowingly? Absolutely not!

Although traditional lenders are not concerned with this fact, but newly emerging money lenders have accepted this fact. And that’s why they are ready to help out the people who are trapped into the hands of bad credit. But, are they really being very kind to you? Well, as mentioned earlier, recession has influenced the growth rate of finance sector as well. That’s why it is getting harder and harder for lenders to survive which has made them look for some out of the box approaches to lend the money. And this has lead to the emergence of bad credit home loan refinance.

By: Alan Lim

Bad Credit Mortgage Refinance – Some Information on How to Get Approved

admin — Tue, 02 Mar 2010 04:41:23 +0000

In these hard economic times, we want to save as much as possible. We want to make sure that every penny that we spend is a penny well spent. Losing money to vanity is no longer an option. We do so by either paying ourselves first when we earn money or by reducing our costs. This reduction of costs can also be done with our current home loans even if we have a bad credit standing. How is that possible? Do banks and lenders regard your credit score as important? They do, but that does not mean you can not get a bad credit mortgage refinance if you are willing to work hard for it.

Before going further, let us define the word “refinance” with more depth. Refinance is the process of replacing your original mortgage with a new loan that has a better rate and terms. The rate could be lower thus giving you lower monthly payments or the loan tenure could be lengthened thus giving you enough time to pay off your loan albeit being more expensive in the long run. Whatever the case, opting to refinance mortgage with bad credit should put you in a better position and not the other way round.

But the bigger question would be would the lenders approve your application for refinance? To be able to do so, you should convince them that you are worthy of a bad credit home mortgage refinance. Show them that you mean business by having at least 10% equity of your home. Improve your credit rating score by paying off your credit card debts and closing unnecessary credit card accounts, paying utility bills and taxes on time and paying off any debts you may have. You also have to make sure that the original home loan is paid off in a timely manner in the last 12 months. If you follow the tips above, then you will have a higher chance of getting approved for a refinance.

Thus, refinance your current mortgage if it puts you in a better position financially. Do it as early as possible to reap the benefits.

By: Lee Sundance

Bad Credit Home Refinance Loans

admin — Fri, 15 Jan 2010 13:51:23 +0000

It can be an extremely useful option to be able to use the money tied up in your home to help pay off debts you may have, or simply to fund an important project or investment. Home equity loans help you to do this, though they can be hard to come by for those with a poor credit score. If you find yourself in this situation then why not try bad credit home refinance loans?

The great news is that if you own a home, even with bad credit, lenders are much more willing to lend money than in any other situation. However, if you fail to make all of the necessary payments then you should always remember that your home will be at risk.

Home refinance loans basically mean that you are taking out another mortgage on the property. Your home is the protection that lenders need, though the amount that they’ll be willing to lend will vary. It will help for you to have a good credit rating, and those with bad credit may expect a lower loan as well as higher interest rates.

Despite the fact that you may experience high interest rates, these kind of home loans can be a great way for you to move forward and help pay off your debt, so long as you’re careful. Many people run into problems by not paying off the loan, or taking more than they really need. So long as you understand your financial situation then you should be able to keep repayments in check.

Bad credit home refinance loans are available from many lenders if you look around. Once you have one, work on paying off your debts as quickly as possible which will help to improve your credit.

By: Shannon Hurn

Tips For Bad Credit Auto Refinancing

admin — Sat, 05 Dec 2009 04:56:50 +0000

While each year many people refinance their home loans, most people are unaware that they can also refinance their auto loans. Especially for those who had bad credit when they received their current auto loan, refinancing could be a great way to reduce interest rates and payments. How do you know if auto refinancing is a good idea for you? And how can you use auto refinancing to improve your current credit situation.

Refinancing an auto loan is similar to home refinancing in that your old loan is paid off in full and replaced with a brand new loan. If you had bad credit when you bought and financed your current automobile then auto refinancing could be perfect for you. The interest rate you receive today could be much lower than your current interest rate, leading to thousands of dollars in interest savings.

You may want to take advantage of auto refinancing if:

• Your current car loan is older than 1 year
• All of your car payments have been on time
• The value of your car is higher than the amount you still owe on the loan

If these three things apply to you then the time may be ripe for you to refinance your auto loan.
Before you consider auto refinancing take the time to look into your credit report. Make sure your credit score is above 620 and that your credit report is fairly clean. You can access your credit report online and are entitled to one free credit report each year.

Next find out how much your car is worth. You don’t need to have a professional appraisal done, but you should get at least a rough idea of the current value of your automobile. Most auto loan companies won’t do a refinancing for less than $7500, so your car should be worth at least that much if you’re thinking of refinancing. You can get a rough idea of your cars value by looking at either Edmunds Buyer Guide or the Kelley Blue Book. Use a critical eye when determining the condition of the car as you can be sure the auto lender will.

Once you have those two things in line then start researching lenders. Your current lender may be willing to do a refinance, but chances are you’ll be able to get a better deal somewhere else. Get quotes from several lenders and compare the rates and fees and refinance the car as cheaply as possible.

While it may take a few hours of work to find the right lender when you’re considering auto refinancing, the time spent will be well worth it. You can save yourself quite a bit of money each month just by doing a simple automobile refinancing.

By: Steven Walters