You may have heard of using the power of the equity in your home to pay off other debts, remodel your house or even to take a vacation. It is becoming increasingly popular but it is also often misunderstood. Most People who have bad credit for whatever reason are unsure if they can take advantage of a bad credit home refinance.
If you are looking for a loan such as this you may be in luck, even if you have bad credit.
Real estate is very unique in this market. Lenders are much more eager to lend money on a piece of property than with just about anything else. The reason is simple. If you do not pay them back, they can foreclose... take your property and sell it to recoup the money back. Care to try doing that with a loan for a vacation? I think many lenders would immediately give you the bum's rush
Refinancing your home is no different. Meaning that you are getting a new first mortgage which will pay off the previous first mortgage and any second or third mortgages on your home. The security is in the house, not in the borrower. Having said that, the amount that lenders will lend varies. If you have great credit lenders will be falling all over themselves competing to lend you 100% of the property’s value or even more and at interest rates you really can appreciate.
However, If your at the other end of the spectrum and your credit is not so good, they may only be willing to lend you up to 80% of your home’s value or even less and at a much painfully higher interest rate. So, there is such a thing as a bad credit home refinancing for you and I but we should weigh our options very carefully.
Bottom line is ...refinancing your home may help you temporarily by clearing off some old debt for you...allowing you to buy that new Hi-Def television or vacation in Hawaii, but beware...it can come back to haunt you. Most follks in this situation eagerly sign the papers for the temporary relief or enjoyment only to find themselves worse off in the long run simply because of outrageous interest rates--you eventually get further in debt and are unable to make your payments.
Fact is, when we reach this point we can no longer refinance our homes and get some breathing room...as all of our equity is used up.
So, sure...there definitely is bad credit home refinancing available but choose wisely and make sure your are doing the right thing for you and your family.
If you want to insure you get the best rates available and avoid bad credit refinancing scams only by dealing with reputable loan companies. In my opinion rebuilding your credit would be your wisest choice.
Did You know with a 720+ Credit Score ...you can be approved for the Car, Home Refinance Loan and Credit Cards you deserve in minutes? Want to learn how to get approved for the credit you deserve? Discover how...log on here and get "8 Credit Secrets" -- FREE!
Article Source: http://EzineArticles.com/?expert=John_Briggs
