Even if you have
bad credit mortgage refinance is still very possible for you.Just
because you have bad credit doesn't mean you can't take advantage of the
low interest rates we are currently experiencing. It may be a little
harder for you now, but it will pay off in lowering your monthly costs
and improving your credit too.
Mortgage companies are throwing money at anybody these days. It is going
to take some work on your part to make sure your credit report is
correct, but you can do it and it will help in the long run.
First you may be able to improve your
credit score. The simplest way is to get your credit report and your
FICO score. Armed with your FICO score, you will know if the lender is
lying to you and saying you don't qualify for a better interest rate.
Next go over your credit report. You
would be surprised how many times there are errors and omissions on a
credit report. The reporting companies may state you have open credit
card balances when you closed them long ago. Go over it very carefully
and make sure your report is accurate.
Do not open any more store charge
cards. Yes I know you will get 10% off if you do, but by opening still
another card, this hurts your overall credit score. Besides that if you
have too many credit inquiries, that also dings your credit score. What
is credit inquires? That is when you apply for credit somewhere and that
will lead to an inquiry of your credit history. If a credit reporting
company sees too many inquires in a short time frame, they lower your
credit score.
Do not close any credit card accounts.
Yes it may help you get your credit card spending under control, but
having a card for a long time helps your credit score. If you close it,
that shortens your credit history and hurts your score. So take those
cards, but them in a safe deposit box and have friends hold them, but do
not close them.
Pay down credit balances. It's
important to show mortgage lenders you are not maxed out on credit. You
should generally try to keep your debt to available credit with your
cards to fewer than 33%. So if your credit limit on your card is $6,000,
do not have more than $2,000 borrowed against it. Once again you are
trying to make your credit look good for the lender.
These are just a few tips to help you
refinance your mortgage despite having bad credit
