A refinance with bad credit is not just a pipe dream; it can now become a reality. No longer does a borrower with bad credit or a bad credit score need to fear refinancing a home mortgage. There are a variety of options to consider. One of the most important steps a borrower takes when applying for a new loan is to find out his actual credit score. If the report shows some problems, the borrower still has several options.
First, the borrower should talk to the lender who granted the current mortgage.
The borrower may find that the lender will be willing to help the borrower with a second mortgage because of past financial history. What some lenders are willing to do is overlook the borrower's bad credit as long as the homeowner's payments are current and he has not had a history of paying late. People who have been responsible homeowners can get lower rates and will need to fill out fewer applications. An alternative to staying with an existing lender is to seek out another lender who offers better terms. If the application fee to refinance with bad credit with other lenders seems too steep, a borrower may opt to stay with the existing lender.
The complexity of the process to refinance with bad credit will vary from institution to institution. The wise shopper will thoroughly check out each firm's fees, payments, and terms, and then take the information to a financial adviser for more input. The loan can carry either fixed rate mortgages {FRM} or adjustable rate mortgages (ARM). An FRM's interest percentage will never change over the term of the loan. The ARM's usually have lower interest rates, but these can be adjusted higher or lower at any time. The wise shopper will research the best type of rates for his situation.
But the most important step any believer can take when making these long-lasting decisions is to present the case before the Lord. The prophet Isaiah says, "The Lord shall guide thee continually" (Isaiah 58:11). No decision a believer makes can ever be right if he doesn't consult with God first, including the choice to refinance with bad credit. But when we take our concerns to Him in prayer, we will be assured that He will guide us to the right decision. Bad credit does not have to be a black mark that bars a homeowner from working towards becoming debt-free. Refinancing may help stabilize a long-term financial plan for a homeowner and his family.
For more information: http://www.christianet.com/homerefinance
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