They can't afford to wait for the Government to create competition in the mortgage industry, they need to refinance now, or risk losing their home to the greedy banks.
And that poses a couple of questions about credit impairment
- If you have bad credit now, and you can't meet your mortgage repayments, how can you refinance away from that lender and get a new home loan?
- How do I find a lender who will set this sort of home loan for credit impaired homeowners?
Mr Mortgage has a section for Bad Credit mortgage loans
When you have bad credit it does not mean that you can no longer finance, or refinance your home, it simply means that you do not conform with regular bank loan guidelines.
There are plenty of other mortgage lenders out there that have mortgage products tailored for the the credit impaired who are looking at mortgage refinancing options.
How to reduce your monthly credit repayments using a bad credit home loan
One thing you must understand about non conforming loans is that they usually have a higher interest rate. This is to compensate for the riskier loan conditions that they non conforming lenders may have to face.
So how can you reduce your monthly repayments if bad credit lenders have higher interest loans?
Basically there are three methods to reduce your monthly credit repayments.
- First you can increase the term of the loan. This allows to spread out the repayments over a longer period of time to make the repayments easier to make.
- Secondly you can consolidate all of you high interest short term loans into the bad credit mortgage loan. If you have credit cards loans, car loans, personal loans, second mortgages, or so called interest free loans that can cost you up to 30% pain interest rates, then combining these loans with your mortgage refinance may be the best way to reduce your monthly repayments to a size that you are comfortable with. In fact many people get into the situation of being unable to meet their mortgage repayments because of all the other debts that they have. so this may be your way to ease your mortgage stress.
- Obviously, combining points one and two above may give you your optimum solution.
Remember a Bad Credit Rating is not a life sentence
I think its important for you to realise that bad credit is usually temporary and soon you might be back on your feet again.
I mention this for two reasons.
- Don't think ill of yourself just because your currently have a bad credit rating. It can pass.
- Also the bad credit home loan solution that I have outlined above should be seen as a temporary fix, say for two to three years.
Once your credit has improved again, then there is no reason why we could not assist you in getting mortgage loans with lower interest rates. So refinancing to bad credit lenders is only step one of the process.
Once you are back on your feet again, refinance to a Low Interest Loan
For more info go to the bad credit section at Mr Mortgage
Author: Rick Adlam Mr Mortgage
