Refinance My Home With Bad Credit

If you have had past financial difficulties, such as missed credit card payments or bankruptcy, you may be wondering, “How can I refinance my home with bad credit?”  There are some steps you can take to refinance your mortgage, even if you have credit problems. 

A potential lender will be interested in your credit history.  Though it may not be perfect, you want it to look as good as possible.  Obtain a free credit report in advance (you can easily request this on-line), and review it for accuracy.  Clear up any errors before applying for the new loan.  For any old debt that you’ve since paid off, ask the creditor to remove the references to the previous delinquency from your report.  If you opted to cancel any of your credit cards, make sure the account is noted as closed at your request.  

It is important to prevent any further damage to your credit history.  Make payments on all of your debts, even if it’s only the monthly minimum.  Don’t apply for any additional credit cards while you’re getting ready to refinance your home. 

Be prepared to document your current employment as well as your earnings history with pay stubs and past tax returns.  You will also be asked about your cash savings and other assets.  In addition to pulling together bank and brokerage account statements, it may be helpful to prepare a list of all your assets, such as bank accounts, investments, your home and cars. 

There are fees associated with any mortgage refinance, and unfortunately the fees may be higher for someone with bad credit.  That makes it especially important for those with a bad credit history to shop around for the best deal on a mortgage refinance.  Luckily, the internet has made it easier to compare mortgage rates and fees among several lenders.