Finance Roll

I think most will agree that having excellent credit will get your foot in the door first to becoming approved for home loan financing from banks versus having bad credit. As the financial banking system matured over the last twenty years or so home loans for people with bad credit still exist even in these turbulent housing times.

Consumer from all roads of life, various tax brackets, with A class and D class credit get approved for refinancing their mortgage loan each day. Many lenders solely specialize in lending to people with bad credit. For most folks it is their one opportunity to correct their blemished credit history.

Consumers who possess bad credit, less than prime, their rates will typically be percentage points higher in interest depending on the lender. The light at the end of the tunnel is once you have a solid history of making your payments on time each month for 24 to 36 months it displays your creditworthiness, and lenders will you a better rate when you are ready to refinance again. It should be noted that currently FHA lenders will allow bad credit and still refinance you at A class or prime rates for an FHA home mortgage loan.

Additional reasons to refinance mortgage loan is to borrow a sufficient amount of money to roll all of your bills into one payment and wipe out any bad debts; Just like other mortgage loans, refinancing with bad credit is offered in 15 to 30 year terms with a conservative fixed rate or one may be eligible for adjustable fixed rate terms. Your mortgage lender will be attentive to any questions or concerns you may have about the loan you are applying for, and show you how to rebuild your credit rating whether it applies to FHA credit and requirements or conventional loans.

If you do not look at all loans offered you may be leaving yourself open to sub-prime rates which can range from the 11 or 13 percent, which is very high, but when it is compared to 21 percent or higher on those credit cards, refinancing your mortgage loan is a wise choice to get rid of other high interest rate debts including credit cards, department store cards and auto payments.

Depending on your FICO credit score, you may find it more advantageous to pay off the balances on your current debts before refinancing. Depending on your financial situation, there are refinancing mortgage loan opportunities available if you search hard enough. Due to some current economic woes, many homeowners are pondering filing bankruptcy. That is a choice to make debt go away, but the damage to your credit rating is unfathomable. In most situations there is a 7 year wait until you can apply and become approved for credit again. Therefore, it may benefit you more if you refinance your mortgage loan to pay off the existing mortgage loan, and consolidate all high interest rate and have one reduced monthly bills.