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Bad Credit Refinance

Perhaps you need a mortgage refinance because you feel like your payments are a little too high. Sometimes after you buy a house, you find that you are having a hard time getting everything paid, and your credit score might lower, making you feel like mortgage refinancing might not be an option for you. The good news is that there are bad credit mortgage refinances that you can get if you have poor credit and own your home. 


If you are not certain of what your options are, you should talk to a loan officer at the place where you would like the loan from. A loan officer will know what to tell you so that you can make a good decision. This type of refinance is for people with poor credit who really need a refinance, and the two main types are the FHA and VA loans. They are backed by the Federal Housing Administration, meaning they are less of a risk for banks because they are insured in case you are unable to make your mortgage payment. Having that insurance there makes the banks more willing to use these loan programs. The interest rates for an FHA and VA loan are typically lower than other loan programs, which helps you to be able to handle your payments easier and not end up in financial trouble. 


Now that you know a little more about this type of loan, you might wonder if you will qualify, and so you should talk to a loan officer and fill out an application. Loan officers will help you through the process and let you know what documents you will need to provide. Many banks and credit unions have loan officers, so the easiest way might be to go to the institution that you bank with and see what options they can offer you for already being one of their customers. Some of the things you will need to provide to your loan officer are employment verification, proof of income, and a credit history. With these documents, a loan officer will better be able to determine if you qualify for any of the programs that the institution offers. Another thing to keep in mind might be that whatever bank or institution that you got your first mortgage with, will probably be the best option for your refinance, because they have already worked with you and will know your situation better than someone else coming into it, cold. 


Having poor credit does not have to stop you from refinancing your mortgage, because there are loans out there that are designed to help people in this type of situation. Life happens and everyone is in a different situation, but that shouldn’t mean that your dreams cannot come true.