Bad Christian Credit Home Refinancing
Bad Christian credit home refinancing provides a way for those with poor financial history to convert to a fixed rate mortgage, remodel, pay off high interest debts, and save on the monthly payment amount. Families who find themselves in a position where they can not refinance may want to check out bad credit home refinancing with lenders online. Some homeowners may even find themselves in a position where they face foreclosure because their monthly payment amount is just too difficult to make. Homeowners may also be suffering with low credit scores because trying to make a large mortgage payment has caused them to get behind on the rest of their bills. Late payments and maxing out charge cards can do a great deal of damage to one's financial history. The best way to go about finding a lender who offers competitive rates is to do a search online and compare options between financial institutions.
One of the types of loans available for homeowners with questionable financial history is through Federal Housing Administration (FHA). Bad credit home refinancing through FHA can help a person to avoid foreclosure. An FHA option means that 97% of the mortgage is covered so the remaining 3% is for the down payment. Congress has raised the limits on FHA options for several months and concessions can be made for the down payment which will mean down payment assistance for those who need it. A fixed rate or an adjustable rate can be chosen. One option allows the homeowner to have a reduction in interest for the first year of the mortgage but this is usually done with an adjustable rate mortgage.
Lenders online advertise that borrower's with past financial problems can qualify for bad credit home refinancing. Bankruptcy, being late on credit card payments and even late payments on a mortgage will not disqualify a potential borrower from being approved. A person can do credit repair before applying for a loan to help raise scores. This can be easily done by disputing any derogatory or incorrect information on financial history kept by the three major credit bureaus. Disputes must be answered within 30 days or the item in question must be removed from the report. When a negative item is removed or corrected then this helps to raise scores.
Homeowner's with bad financial history can qualify for refinancing because some lenders do not evaluate a person based solely on past financial history. Mortgage companies that offer bad credit home refinancing takes the borrower's ability to repay into consideration by looking at income and other factors. The borrower must be able to prove income by supplying paycheck stubs or profit and loss statements. A lender will want to figure debt to income ratios when the borrower has a great deal of debt. A borrower's past payment history on an existing mortgage may be taken into consideration. If the borrower has made several years of payments on time a lender will be more likely to give an approval even if their current situation has put him or her behind. "The rich rule over the poor, and the borrower is servant to the lender" (Proverbs 22:7).
Cash out refinance provides an option for the borrower who is trying to pay off high interest credit card debt. Bad credit home refinancing can allow a homeowner to get cash from the equity in the home. The difference between the value of a home and what is owed leaves the amount of the equity. Some homeowners may want to convert from an adjustable mortgage to a fixed rate mortgage so they do not have to worry about the monthly payment amount increasing over time. In addition, refinancing with a lower interest rate could save the homeowner a great deal of money and allow him or her to pay off the mortgage years sooner. A cheaper payment along with paying off existing high interest debts could mean a lot to borrowers who have been barely able to pay their bills each month and in some cases have fallen behind.
Some mortgage companies view borrower's with poor financial history as sub-prime candidates. This could mean paying a significantly higher interest rate on bad credit home refinancing options. The best thing to do is to check out several mortgage companies before making a decision. Some lenders are a little less strict about interest rates and approvals for those with questionable or low credit scores. Sub-prime candidates are in a category where lenders that will approve for financing may look closely at debt to income ratios and loan to value ratios. Borrowers who have a large amount of equity in the home will be seen by lenders as a lower risk because the actual loan amount will be less. Also, if a homeowner has free cash each month because his or her income exceeds debts then they have a better chance of being approved for a refinance.
An interest only mortgage refinance allows the borrower to pay only interest for the first couple of years of a loan. Bad credit home refinancing usually allows the borrower to choose this option if there is a good chance that income will increase and debts will decrease in the future. This allows the homeowner to make lower payments because he or she is paying interest only, no principal goes to the loan amount. This option can work for those who believe their financial situation is going to get better soon. After the period of interest only ends then the borrower will still owe the same amount on the house as he or she did at the time of the loan. After this time if the value of the home increases above the loan amount then the homeowner will still have built some equity in the home.
Bad Christian Credit Mortgage RefinancingBad credit mortgage refinancing allows those consumers with poor financial ratings to receive refinancing services on home loans. Although this may not seem like a possibility, many lenders and finance companies work with individuals to lower interest rates and payments on mortgages. This can actually help to improve the credit rating of the individual. When spread out over 15 or 25 years, a 2% interest difference in the interest rate can be substantial. Also, lower rates are possible because there is a valuable commodity in place as collateral--the debtor's home.
When seeking to refinance a home, the homeowner must go through roughly the same process as when applying for the original loan. There are many costs involved, and someone with bad credit needs to be more cautious than most to be sure there is no further damage to the financial records. Bad credit mortgage refinancing involves having the property surveyed and inspected, a title search to be sure the title has no previous liens on it, loan application fees, attorney fees, etc., all of which are substantial costs. It is possible to find a lender who will absorb those costs for a slightly higher interest rate, or the homeowner can pay those costs and get a lower rate of interest. Choosing to refinance is an answer to financial difficulties in many cases, but one should be careful about what company or bank they are dealing with. Checking out the lenders before signing any papers is wise, and using wisdom and discretion in this research process is a must to find the best deals and rates. "My son, let not them depart from thine eyes: keep sound wisdom and discretion" (Proverbs 3:21).
The process of refinancing is also sought when a homeowner has an adjustable rate mortgage. When the interest rate is adjusted every few years, the monthly payments change accordingly. Even bad credit mortgage refinancing applicants should get a fixed rate, so the monthly payments will remain the same over the time of the loan. Taxes become the only variable, which makes financial planning more predictable. With a refinancing program for those with bad credit, the homeowner can choose to shorten the time for paying off the mortgage as well, thus becoming debt free sooner. At this time, it appears not to take any longer to find a lender who will assist in bad credit mortgage refinancing than if one's credit is listed as "good." In a more conservative lending environment this would not be so.
A bad credit refinance of one's home or car allows people a fresh start by paying off high interest loans with a loan offering more favorable terms. Not only will a lower interest rate help lower monthly loan payments, but also people will be able to own their home or car more quickly. A bad credit refinance can be a way to help repair financial worth by taking a step toward paying off their debt.
Ecclesiastes 7:12 states, "For wisdom is a defence, and money is a defence: but the excellency of knowledge is, that wisdom giveth life to them that have it." People should become knowledgeable and gain wisdom in this area. Bad credit refinance pays off current high-interest debt with a lower interest loan. Even if a lender convinced a person that their interest rate had to be high because of a low financial score, they may be able to find another lender willing to refinance at a lower rate. Those who have compromised their financial standing, but have been making efforts to pay off their current debt, may be able to refinance at a lower rate than a car or home loan was originally financed.
Different people have different reasons for considering finance options. The most common is to refinance their debt at a lower rate. However, others may want to combine debts into one more manageable monthly sum. Regardless, bad credit refinance can be a useful financial tool in helping lower monthly payments because of a lower interest rate. This lower payment will also help a person's credit situation as they will have additional cash each month to apply toward a budget or to pay off other unsecured debt. Pay back options are available for car loans, or first or second mortgages.
Do you know someone who is a candidate for a bad credit refinance loan? If they have a financial score lower than 620 or a qualifying debt-to-income ratio of 50% or higher, they may be eligible. Furthermore, people who qualify for bad credit refinance options also have had more than two 30-day delinquent debt payments in the past 12 months, or have declared bankruptcy in the last 60 months. In addition to any of the above qualifications, if they have a limited ability to pay their monthly expenses, they may want to look into options to regain financial worth. Most financial companies require that people are at least 18 years old and are up-to-date on other loan payments.
Many Christian lending companies are available on the Internet and are willing to various payback options for those with limited funds, bankruptcy, or poor financial problems in the past. With these companies, they can apply online and expect to receive fast approval notification. If they currently have a high interest loan on their home or car, they should consider looking into bad credit refinance to get better terms.