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Refinancing your mortgage is
one way to rebuild your credit, particularly if you have recently
declared bankruptcy. With a poor credit history, you can find
refinancing through a sub prime lender. To rebuild your credit, make
regular payments on your mortgage and other bills. Then after two years,
refinance again for lower rates with your now good credit rating.
A Note About Sub Prime Lenders
Sub prime lenders offer B, C, and D credit, which means they offer
credit to high risk lenders. For taking on these high-risk loans, sub
prime lenders charge slightly higher interest rates and fees.
Some sub prime lenders charge excessively high fees, but you can screen
these out by comparing mortgage rates. Online mortgage lenders make this
easy with their online quotes and posted rates.
Applying For Refinancing
Applying for refinancing has been made easy with the internet. The first
step is to collect several financing offers, and sort through them. Look
for low fees and interest rates.
Once you have picked a mortgage lender, fill out the application either
online or request an application mailed out to you. Once you have
submitted your application, it will be reviewed and processed. You
refinancing should be completed in about 6 weeks.
Getting Financing Approval
Getting approval for your refinancing application is a common concern.
While lenders approve more B, C, and D credit loans today, you can also
stack factors in your favor. Paying off loans, closing unused credit
card accounts, and making regular payments on credit cards and other
loans will help. Another step is to put a note in your credit report
explaining the reason for past due bills, foreclosures, or bankruptcy.
Rebuilding Your Credit
The next step to rebuilding your credit is to make regular, on time
payments on your refinanced mortgage and other bills. Making regular
payments is the single fastest way to establish good credit. Make the
bill payment easy by setting automatic withdrawals through your bank.
Refinance With Good Credit
After you have established a good credit history, apply again to
refinance your home for lower interest rates. If you declared
bankruptcy, wait at least two years to refinance. However, if you simply
had a series of late payments on your credit, wait a year before
researching refinancing options.
About the Author: Carrie Reeder is the owner
http://www.abcloanguide.com, an informational website about various
types of loans. To view our recommended sources for sub prime mortgage
lenders online, visit this page:
http://www.abcloanguide.com/lessthanperfectcredit.shtml
Source: www.isnare.com
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