Bad credit refinancing » Mortgage Refinance

Refinancing Your Mortgage – Changing Your Interest Rate

admin — Wed, 30 Jun 2010 11:25:24 +0000

The opportunity to change the interest rate on a loan is one of the most common reasons that people consider mortgage refinance. Interest rates are always changing, sometimes for the better, and during these times homeowners want to take advantage and pay off one loan in favor of another that has a better interest rate. This is a process that many people have been through and those people have been able to save hundreds or thousands of dollars over the course of their mortgage loan, effectively lowering their monthly payments.

Lowering Your Interest Rate

If your goal is to lower your interest rate on your loan, you might not have a difficult time doing this. Many people find after several years of owning a home that the interest rates have dropped and they could save a lot of money if they considered mortgage refinance now. You’ll hear a lot of different rules of thumb as to when you should refinance, but the fact of the matter is that if you can refinance and have your savings exceed the cost of the refinance you are probably making a good move.

It’s important when you are considering mortgage refinance to not get carried away by the thought of saving. Mortgage refinance is a great opportunity to lower your interest rate but when you are considering this you need to look at the math and make sure that you are actually saving. The trouble that a lot of people have is that they are willing to accept a one percent decrease in interest, and while this is better, when you figure out how much you are paying in closing costs you might not end up any better for the refinance.

When you are serious about mortgage refinance you want to shop around and get the best deal for you. There are a lot of different loan programs out there for you to take advantage of and you should compare them all to see how much you really can save. Lowering your interest rate can do wonders for your monthly payment, but only if you go about it the right way. This is when it pays to educate yourself about how refinancing works and to work with a mortgage lender that you know you can trust to help you choose the best option for you.

Doing the math is important when you are trying to lower your interest rate because there are costs associated with refinancing and sometimes the costs do exceed the savings. This is why many experts recommend only refinancing when you are making a big change in your interest rate because that is how you are going to save the most amount of money. Even if you think that you are going to save a lot, you should always do the math to be sure that the savings are what you thought that they would be. You should always defer to the numbers before you accept any deal because when you look at the numbers you might be surprised at what the actual savings are. If you find that it doesn’t make sense to go through with the mortgage refinance, don’t do it, wait until rates drop further or you can get a better deal.

By: Robert Melkonyan

Mortgage Refinancing: How to Refinance with Bad Credit

admin — Wed, 30 Jun 2010 01:42:58 +0000

Bad credit can happen to anyone in any situation. If you fall behind on your credit card payments and start missing payments your credit will suffer. When it comes time to refinance your mortgage all of these late payments will have a negative impact on the mortgage you will qualify for. Here are tips to help you clean up your credit and qualify for a better mortgage.

The state of your credit will influence your reasons for refinancing. You may be refinancing your mortgage to lower your monthly payment. You can accomplish this by qualifying for a better interest rate or choosing a mortgage with a longer term length. Another reason for refinancing your mortgage is to improve your credit by consolidating debts. You can refinance your mortgage with cash back from your home’s equity to pay off your higher interest debt. Consolidating your bills will help you take control of your budget and catch up on your bills.

Before you refinance your mortgage for any reason you need to take stock of your credit and improve your credit score as much as possible. Your credit score is derived from your credit records. Credit records are maintained by three credit agencies; these records are often prone to errors. Request copies of your credit records from each of these three agencies and carefully scrutinize them for errors. If you find errors you will need to dispute the error prior to applying for a mortgage.

After you are certain your credit records are accurate, request your credit score. Your credit score is often referred to as a FICO score, named for the company that calculates it. Your credit score is determined by a number of factors in your credit records. These factors include your history of debt repayment and how much debt you have. You can improve your credit score by paying down the balances on your credit cards and ensuring all of your payments are made on time.

By: Louie Latour

Home Refinance: Why You Want to Refinance Your Mortgage

admin — Tue, 29 Jun 2010 14:40:11 +0000

You may want to refinance your home for several reasons. The biggest reason that people refinance their homes is to save money.

If you qualify for a lower rate you could lock in that lower mortgage rate and stretch out the payments so that every month you are paying less to live in your home than before.
Once you decide to refinance your home, you will undoubtedly be confronted with a variety of choices as to what sort of new loan you can get.

One tactic people use is to shop the rate around to several banks to see what the best deal is for them. Refinancing your mortgage can certainly free up a lot of capital but you have to be careful. Some unscrupulous lenders may advertise a lower rate, but once you work out the math the lender may have added so many points and fees to your refinancing that you are actually paying more than some of the other advertised rates.

When you refinance your mortgage, you may be able to substantially reduce your monthly payments, especially when we are in a low interest rate environment like we are today. You may have bought your home in times of relatively high mortgage rates and therefore are locked into higher payments than you should be. These days, mortgage rates have been hovering around 6% and lower for a while. If you want to refinance your home and cut your monthly payment, now may be the best time to do it.
Mortgage rates rarely stay the same for long time periods.

Refinancing Your Home to Free Up Money for Other Purposes

Many people who are deeply in credit card debt or who have recently filed for bankruptcy may want to refinance their homes in order to free up some of their home equity and pay off their other debts. This can be a good strategy if the other debts are high interest rate debts. It’s not too hard to figure out that paying off debts that are charging you 20% per year with debt that is only costing you 6% a year might be a good deal.

People who refinance their homes often come out better than before, but as usual it pays to shop around. Find the best deal your can for your mortgage and your may be able to have a lot of spare money every month.

By: Richard Martin

Online Mortgage Refinancing Advice – Should You Refinance Your Mortgage?

admin — Sun, 20 Jun 2010 03:26:27 +0000

Refinancing is nothing more than replacing your existing mortgage loan with a new loan. If interest rates have dropped since you last financed your home, refinancing at a lower rate (even 1 percent) can save you a lot of money.

You don’t have to be a mathematician to figure out whether a refinance would save you money. You’ll need to know your total closing costs and your new monthly payment to make an estimate. Let’s assume that your mortgage payment is $1250 and you find a lender that will cut your loan payment by $200 a month. That’s $2400 a year!

But wait… The new loan comes with a price. It’s not unusual for a refinance loan’s closing costs to be in the $4000 neighborhood. That’s a lot of money. But, the next question is. How many months will it take me to recover my costs of getting the new loan? At a monthly payment savings of $200 a month it would take 20 months to get back to a break-even point in this case.

After the break-even point it all depends on how long you stay in your home. If you were to stay in your home for 60 months or (5) years after the break-even point, you would save $12.000. Not a bad deal!

Refinancing a mortgage isn’t cheap and it’s not always easy, but when you consider the possible savings, it could be worth your time and effort. Mortgage interest rates rise and fall all the time. A drop of just 1 percent in mortgage interest rates can be enough to make refinancing worthwhile for you.

By: Frank W Ellis

California Refinance Loans – Refinancing Tips to Help You Save

admin — Mon, 14 Jun 2010 18:04:49 +0000

Many homeowners in California are scrambling to refinance their current home loan before interest rates get too high. Some are hoping that a California refinance loan will help them get rid of their adjustable rate or interest only loan. Others are hoping to move from a high fixed rate into a low adjustable rate or hybrid loan. If you are considering a California refinance loan, here are several refinancing tips to help you save:

Refinancing to a Fixed Rate Mortgage

California refinance loans with fixed interest rates can be very beneficial to homeowners who have found themselves in trouble due to a hike in the rates of their adjustable rate mortgage or interest only loan. Refinancing is also beneficial for those who got their current fixed rate loan when interest rates were high due to bad timing or credit problems.

Refinancing to an Adjustable Rate Mortgage

Fixed rate loans are great for those who like consistent payments, but for California homeowners who don’t plan to stay in their home for much longer or for those who need an instant drop in their payments, an adjustable rate California refinance loan may be the best option. This type of refinance loan allows you to take advantage of low introductory rates. If you have fair to good credit, you could get an interest rate as low as 5 percent on a California refinance loan.

Refinancing to a Hybrid Mortgage

A hybrid loan offers the best of both worlds. With this type of California refinance loan, you can take advantage of low adjustable rates during the first five to ten years of your loan before moving to a more consistent fixed rate. You will want to be careful though, not every hybrid loan has the same terms.

By: J. Hale

125% Loan to Value and Mortgage Refinance

admin — Sun, 13 Jun 2010 07:02:40 +0000

Did you know that 125% loan to value and mortgage refinance are extremely risky for borrowers?

Well, they are! That’s why you better think twice before jumping into an exotic 125% loan to value (LTV) second mortgage that allows you to refinance by borrowing more than your home is worth.

It sounds too good to be true, and it is. That’s why the Federal Trade Commission warns, “Borrowers Beware!”

Too many unscrupulous lenders use 125% loan to value and mortgage refinance to prey on vulnerable homeowners. Even though LTVs opens a door for lots of people to borrow, especially young couples with limited income and often shaky credit, this type of loan comes with a high price.

Interest rates are much higher and closing costs often add up to more than 10% of the loan balance. There have actually been stories of interest rates as high as 30% and hidden fees of 20 points or more.

LTVs are costly because, since there’s no collateral and no way for the lender to foreclose, LTVs are also risky for lenders. So, they make you pay through the nose for the privilege of borrowing.

This high income potential attracts unscrupulous lenders and debt consolidation “advisors,” high pressure home improvement salespeople and so-called foreclosure “rescue” companies willing to take a gamble on the risk of default in return for the huge profits they can make at the borrower’s expense.

They persuade vulnerable homeowners, often people with lower income, high credit card debt or poor credit, into believing that 125% loan to value and mortgage refinance are in their best interest. And they make an offer that sounds too good to refuse, with very attractive, extremely low monthly interest-only payments. But the offer comes with a huge burden.

Somewhere down the line, usually a lot sooner than you anticipate, you’re going to have to come up with a bundle of money to pay a big balloon payment. By the way, did you know that if you have to move for any reason, you can’t sell your home without first paying off your balloon loan? And where are you going to raise the money, since you owe more than your home is worth?

Think about it! When the balloon comes due, if you can’t raise enough quick cash in time or refinance at a cost you can afford, your balloon bursts and you’re in a lot of trouble with no way out. And balloons are bursting all the time. They’re one of the main reasons mortgage defaults and foreclosures are approaching record breaking highs all across the country.

Too many people got themselves suckered into exotic 125% loan to value and mortgage refinance loans with risky balloon payments. And now they’re paying the price.

LTVs are not for the desperate already drowning in debt, no matter how seductive they may seem. So before jumping into one, always do your homework and carefully consider all your alternative options.

And, by all means, work only with reputable lenders you know you can trust. And never let yourself be conned into some deal that’s only going to get you deeper into debt. It’s not worth it!

By: Jack Tanner

VA Streamline Refinance Has Hidden Benefits

admin — Thu, 10 Jun 2010 18:49:12 +0000

Very few veterans know about the benefits of a VA Streamline mortgage refinance. There are a few benefits that are hidden to vets. One of the biggest is that with a VA Streamline refi there are no credit qualifications! You can have multiple late payments and collections on all types of credit and still qualify. The only exceptions to that are judgements and liens that are attached to the property. they would have to be paid through the refi but you can still move forward with the refinance. This is a huge benefit to veterans who may have had credit problems and would other wise have to choose a sub-prime mortgage in a refinance transaction.

Knowing this one fact can save you thousands on your mortgage over the life of the loan and hundreds of dollars per month. sub-prime mortgages also generally have an adjustable aspect to the interest rate so it is much better to use VA benefits to get into a fixed rate va loan at a much lower interest rate. Interest rates on VA loans can be as much as 8% lower than than rates on sub-prime mortgages.

The only credit qualifications involved with a VA Streamline Refinance are that you cannot have more than one 30 day plus late payment on the mortgage in the most recent 12 months. That is it!! These are very easy loans to complete and the majority of veterans qualify. Even if you have had a foreclosure on a different property six months ago you can still qualify.

To learn more about VA Streamline Refinance loans, please feel free to visit:

By: Chad Childress

How Soon Can I Refinance a Mortgage?

admin — Thu, 10 Jun 2010 01:40:40 +0000

How soon can I refinance a mortgage is a question asked by many people looking for mortgage refinance options. However, before we take up your question, it is pertinent to understand what is refinance mortgage and how it is going to benefit you. You may be looking for opportunities to optimize your monthly payments by eyeing on the various refinancing mortgage options available for your mortgage plan.

You might be wishing to change over from the fixed rate home loan or vice versa. The change depends upon the interest rate. You may also be wishing to go in for cash out refinance mortgage options that allows the payment of all the old loans and allows for the new ones at the same time.

Before you are allowed to refinance a mortgage, lenders will give a careful look into your current balance, your monthly balance and the period left for the payments and then decide how best to help you. To get the best deal, advice of a mortgage consultant would be of a great help because they are the best person to offer you the right tips to refinance a mortgage.

Meaning of Refinance Mortgage

Refinance mortgage mean different things to different people. Mortgage refinancing could mean combining the first and second mortgages into a single mortgage. You may wish to increase the duration of repayment say from 15 to 30 years. You may be having extra cash at some point of time prompting you to shortening the loan duration. You may be wishing to change over from adjustable rate mortgage to a fixed rate mortgage with lower interest rate.

You may also be wishing to consolidate other debts and paying them off by refinancing a mortgage. All the options for their worth will have to analyzed to derive the maximum benefits from refinancing mortgage. You have to decide when to start the refinance. A word of caution, make sure you are not saddled with hidden costs while changing over. Advice of a mortgage consultant and adherence to the tips to refinance a mortgage should be of a great help to you for this critical decision.

Facts about Refinancing Mortgage

Before you go in for refinancing a mortgage it is always advisable to consult a mortgage consultant to learn about how much reduction will be there in the monthly payments on the reduced interest rate. The rate you are likely to get for mortgage refinance will depend upon the size of the loan, your credit score, type of lock in rate or you want it float, the closing time and the market conditions.

Beware of the best possible advertised mortgage rates because these are made only to the first few applicants. You are the best judge to know what is best mortgage refinance option for you in the long run.

By: Al Falaq Arsendatama

Mortgage Refinance – Tips to Help You Cut Fees and Costs

admin — Thu, 03 Jun 2010 03:44:23 +0000

Saving money through a mortgage refi is more than just finding the lowest interest rates. You can further cut fees and costs through the structure of your loan, avoiding PMI, and buying lower interest rates.

Close Credit Card Accounts

Close inactive credit card accounts to improve your credit score, making you eligible for lower interest rate loans. You will need to notify the credit card companies in writing that you wish the accounts closed on your request.

Next, check your credit report after 30 days to be sure closed accounts include the comment “Closed at Customer’s Request.” You want future lenders to know it was your request and not bad credit that closed your accounts. Also, take the time to check for any mistakes in your credit report that could negatively impact your credit score.

Avoid The Hidden Cost Of PMI

When refinancing a mortgage, as many as 30% of homeowner’s cash out part or all of their home’s equity. By investing in home improvements or paying off credit cards, this can be a smart. But, if you are borrowing more than 80% of your home’s value, you will be hit with private mortgage insurance, costing you hundreds a year.

Pay Points Now

If you are planning to stay in your home for several years, then you can save money by paying points for lower interest rates. You pay up front fees to ensure you have lower interest payments over the course of your loan. Remember, this only works if you keep your mortgage for several months.

Choose A Short-Term Loan

Short-term mortgages offer lower interest rates than long-term mortgages. You save money by the lower interest rates and shorter payment period. The trade off is a larger monthly payment, but this option can save you thousands.

Ask About Fees

Fees are a hidden cost of many mortgage loans. By law, lenders must disclose fees within three days of a loan application. Fees can go by many names like – document prep fees, courier fees, administrative fees, and more.

When comparing refi options for your mortgage, request a list of fees from several lenders. Add these fees with the interest of a loan. With these figures, you may be surprised that the cheapest loan didn’t have the lowest interest rate.

To view our recommended sources for refinance mortgage loans online, visit
this page: Recommended
Refi Mortgage Lenders Online.

By: Carrie Reeder

How to Get Cash Back on a Refinance

admin — Sun, 23 May 2010 06:13:18 +0000

There are two ways to get cash out of a mortgage refinance. The first is a traditional cash-out refinance where the loan amount is higher than what it takes to pay off the previous mortgage balance based on a new appraisal of the home or an increase in the value of the home as it appreciates.

Typically this first method does require a lower loan to value ratio meaning that in order to take cash out, your home value or appraised value as compared to the loan value must be a certain percentage. Double check with your mortgage broker to determine what this number is.

The other way to get cash out of a mortgage refinance is to refinance your home at a higher interest rate and split what is known as the YSP or yield spread premium with your mortgage broker. The YSP is a rebate that the lender pays back to the mortgage broker for selling the interest rate above the par rate. In most cases, this is a 1% rebate on the loan amount for each “point” or quarter % that the rate is increased.

For example, on a loan amount of $300,000, the YSP on a interest rate of 6.25% for a 6% wholesale “par” rate would be a 1% rebate on the $300,000 or $3,000 due to the 1 point increase. So, if you wanted to get out $6,000 to pay off a credit card or something like that, you could (in theory) take that higher percentage rate of 6.5% using the same numbers from above and get back the $6,000. This will typically cost you more than the 6.5% if you wanted to cover closing costs and assuming the mortgage broker is paid as well may cost you closer to 7%.

The danger of this is that you are stuck with this increased payment for the duration of the loan until you sell your home or refinance again. So, this works well if you know you won’t be in a home for a long period of time and also may work well if you have steady income a good credit score and the ability to qualify for another refinance in a few months (depending on the lender’s stipulations).

Be careful with this method and be sure to find a trustworthy mortgage broker to work with on this. It helps if the mortgage broker is familiar with this method of rebating back to the borrower. In most cases the broker can’t pay out any sort of referral reward to a 3rd party, but there are no problems with giving back to the borrower any or all of the YSP.

By: Brian G Armstrong