Bad Credit Refinancing
Bad credit refinancing is a refinancing loan for poor credit borrowers. These bad credit refinancing loans are very similar to taking out the initial mortgage, insomuch as the fees and costs are comparable. To save on charges, specifically the closing costs, it’s often wise to apply for the new home loan with your current lender, as they may waive some of the existing fees.
A recent decline in mortgage rates has driven people to refinance their existing home loans in order to lower monthly payments and/or capture a fixed interest rate. This attractive financial option is not exclusively reserved for borrowers with established credit. Homeowners suffering from poor credit may also reap the benefits of refinancing mortgage loans.
Bad Credit Refinancing Rates
If the borrower wishes to take advantage of an option that requests little or no closing costs, he/she may be burdened with a marginally higher interest rate. However, the homeowner is typically still likely to benefit, especially if they plan on moving in under three years. For additional information on purchasing a home, refer to our 12 Steps To Purchasing A Home.
Another option entails the inclusion of the closing costs into the home mortgage loan itself. The total amount of the loan will inherently increase, but the borrower will not have to pay the closing fees out of his/her own pocket, thus benefiting those who often find themselves low on cash (i.e. someone with poor credit).