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Is Refinancing With Poor Credit Possible?

With rates at incredible lows, Americans across the country are refinancing their mortgage. But if you have poor credit, you may be wondering if it's possible. 

Refinancing with a low credit score isn't the ideal position, but it is possible. Here's everything you need to know about refinancing into a lower rate mortgage while having bad credit. 

But first, why bother refinancing in the first place? 

Refinancing saves you money because you end up paying less interest over the life of the loan. That can also translate to lower monthly payment, but if nothing else, it means that more of your payment will go to the principal than the lender. 

A handsome prospect for anyone! But for those with less-than-ideal credit, refinancing at a fair interest rate can be difficult. 

Review: How Your Credit History Impacts Refinancing

Lenders use your credit score to guess the likelihood of repaying the loan based on your previous habits of repayment. 

People with high debt or late payments appear "high risk" to lenders, thus, may disqualify from getting a loan.  

How to Refinance with Poor Credit

If your score is preventing you from refinancing, here are some tips to help improve your chances:

Raise Your Score

  • Work on paying all of your bills on time. 
  • Don't take out multiple new credit lines.
  • Pay down your total debt, particularly maxed out lines of credit.

Have assets on hand

Work on building a savings to demonstrate that you have the means to repay the loan.

Get a co-signer

Add someone with a higher credit score to co-sign the loan. This assures that the loan will be paid because a person with good credit is also responsible for the loan. 

Do an FHA Streamline Refinance

An FHA Streamline Refinance is a program for people who have an FHA loan. Unlike a traditional refi, an FHA Streamline Refi allows refinancing without the need to verify income or assets. It also doesn't require a minimum credit score.

Consider Alternatives to Traditional Refinancing

The Home Affordable Modification Program (HAMP) helps homeowners pay down their mortgages and foreclosure. It works by reducing monthly payments to 31% of their pre-tax monthly income. Banks that offer loans owned by Fannie Mae and Freddie Mac are required to participate in the program. However, some lenders do it voluntarily. 

The Home Affordable Refinance Program (HARP) is yet another program to consider. Homeowners current on their mortgage payments and whose property value has gone down may qualify for HARP program. 

Rates are at record lows, so we encourage you to explore the possibilities, and don't assume that your low credit will stop you. Contact us today and get definitive answers on refinancing. 



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Nation One Mortgage Corporation strives to ensure that its services are accessible to people with disabilities. Nation One Mortgage Corporation has invested a significant amount of resources to help ensure that its website is made easier to use and more accessible for people with disabilities, with the strong belief that every person has the right to live with dignity, equality, comfort and independence.

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Despite our efforts to make all pages and content on Nation One Mortgage Corporation website fully accessible, some content may not have yet been fully adapted to the strictest accessibility standards. This may be a result of not having found or identified the most appropriate technological solution.

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Nation One Mortgage Corporation Accessibility Statement

General

Nation One Mortgage Corporation strives to ensure that its services are accessible to people with disabilities. Nation One Mortgage Corporation has invested a significant amount of resources to help ensure that its website is made easier to use and more accessible for people with disabilities, with the strong belief that every person has the right to live with dignity, equality, comfort and independence.

Accessibility on Nation One Mortgage Corporation website

Nation One Mortgage Corporation makes available the UserWay Website Accessibility Widget that is powered by a dedicated accessibility server. The software allows nationone.com to improve its compliance with the Web Content Accessibility Guidelines (WCAG 2.1).

Enabling the Accessibility Menu

Nation One Mortgage Corporation accessibility menu can be enabled by clicking the accessibility menu icon that appears on the corner on the page. After triggering the accessibility menu, please wait a moment for the accessibility menu to load in its entirety.

Disclaimer

Nation One Mortgage Corporation continues its efforts to constantly improve the accessibility of its site and services in the belief that it is our collective moral obligation to allow seamless, accessible and unhindered use also for those of us with disabilities.

Despite our efforts to make all pages and content on Nation One Mortgage Corporation website fully accessible, some content may not have yet been fully adapted to the strictest accessibility standards. This may be a result of not having found or identified the most appropriate technological solution.

Here For You

If you are experiencing difficulty with any content on Nation One Mortgage Corporation website or require assistance with any part of our site, please contact us during normal business hours as detailed below and we will be happy to assist.

Contact Us

If you wish to report an accessibility issue, have any questions or need assistance, please contact us by sending an email to: info@nationone.com