Bad Credit Mortgage Refinance

Need to refinance your house but have bad credit? Have you been late on your mortgage payments due to economic conditions and need to refinance? You are not alone as thousands of people are in the same boat. There are solutions that have been created due to the stimulus packages that have been issued and we would like to let you know what your options are to help you lower your monthly mortgage payment.

The FHA secured loan is designed for people who are facinginevitable foreclosure due to mortgage payments adjusting beyond their means of affordability.  If you took out an 80/20 or ARM loan back before 2007 then you probably are aware now that your rates were not fixed.  For many people in the economy this is financially devastating because with the rate increase you are probably making less money and the ability to make your house payment has probably been diminished. 

The secured loan from FHA is designed to help those with adjustable rates afford their home by switching their loan to a lower more affordable fixed rate. 

 What exaclty are the guidelines to qualify for these types of loans?  We have created a list of the requirements that must be met to qualify for this life saving loan program.

• Your credit history must reflect prior on-time mortgage payment history BEFORE your mortgage rate was adjusted.
• You must have a stable employment history for the last 2 years shown by yoru last 2 years of W2's.
• The home you live in must be occupied and you either need 3% of equity in your home or 3% cash for a down payment.
• You must be able to prove your income to pay for the new loan and new fixed rate.  This proof can be obtained by your last 2 paystubs.
• The adjustable interest rate on your home must have been set to adjust between June 2005 - December 2009.  Loans taken out today by borrowers will not qualify for this program in the future. 

The nice thing about this type of loan is that there is no pre-payment penalty if you come into some money and want to pay the loan off early.  If you qualify for this type of loan, FHA can get your home out of the pre-foreclosure or foreclosure status within 14-21 days. 

 If you are looking into this type of loan option there are a few essential things you can do to prepare to make this process smooth and easy. 

1. Make sure you have proper documentation.  Find your last 2 paystubs that cover the last 30 days and find ALL W2's that cover the last 2 years.  You CANNOT get qualified without this documentation.
2. Make sure you do not change jobs.  Having a consistant 2 year employment history is pure gold to a lender and will make your chances of getting qualified much higher.
3. Don't pull your credit or make any credit purchases.  DON'T buy a car or use your credit card to make a purchase while qualifying to get a home loan.  Doing this will ruin your debt to income ratio and kill your chances of refinancing.

These are just a few easy tips to help you get through the qualification process.  To learn more about programs and loan secrets visit Bad Credit Mortgages Help.

The actual process of getting an FHA secured loan is actually very easy. Most likely your bank where you have your checking and savings accounts does FHA loans.  Next time you go to the bank you could ask them about the FHA Secured loan and see what they need to get started.  If you don't want to use a local bank but want banks to compete for your business then use a mortgage broker.  Anyplace that does FHA loans will be able to do an FHA secured loan.