Bad Credit Refinance Loans - Finding a Good Lender

By: Jas

Look At Your Credit Record

Credit records are not perfect accounts. Before you apply to refinance your loan, you should check to see that all your information is correct. If you believe there is a false record, resolve it with the credit reporting company.

You also want to know what your credit score is. The lower the score the higher rate you will have to pay, but at least you will have an idea of what to expect from a lender. Paying three to five additional points is common for people with bad credit history.

Compare Lenders

Lenders offer different rates for the same type of loan, so shop around. The easiest way to compare quotes is to use an online website. By entering your information online, companies compete for your loan, offering you better rates. The internet also allows you to compare mortgage lenders outside your local area, possibly finding a better deal.

Once you receive offers, compare the rates and fees. Often the fees are where lenders make their money. Adding up the interest and fees, and comparing that figure will give you the true cost of the loan.

Look For A Good Deal

Mortgage lenders increase their profits by pushing loans with high interest rates and points. Some lenders will push these types of loans even if they aren't best for you, so beware of fast-talking dealers. Be sure to read the terms and look for hidden fees before you sign the paperwork.

Online mortgage companies eliminate some of this risk by requiring mortgage lenders to state their terms online. Online quotes are also more competitive since lenders know you are probably shopping around to refinance your loan. Once you have an offer, print out the terms for your records.

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