REFINANCE » Refinance Your Mortgage

Both home prices and mortgage loan interest rates are at the lowest they’ve been in a long while. Even so, the number of home sales is declining and many are wondering if the housing market will ever recover while interest rates are depressed.

For those who already own homes but would like to lower mortgage payments, many aren’t sure whether to refinance now before interest rates jump back up or if this current trend will lead to even lower mortgage rates later. One thing is for certain, however–the Fed can’t keep rates down forever and it’s inevitable they increase sooner or later.

With very few exceptions, one of the first things a potential lender will ask you for when you apply for a mortgage loan is your permission to run a credit check.

If you have some concerns about your credit history and rating, you might want to think about what some people call a “no credit check mortgage.” There are lenders that specialize in helping people with bad credit purchase homes and acquire financing at a reasonable interest rate.

Do Mortgage Lenders Always Perform a Credit Check?

Economists say that a great way to stimulate the economy without spending any more money is by taking advantage of lowered mortgage interest rates.

More specifically, Morgan Stanley economist, David Greenlaw, says by making it easier for homeowners to refinance their homes, Americans could save more money, which could then prompt them go out and spend more instead. In his report titled Slam Dunk Stimulus, Greenlaw determined that by relaxing refinancing requirements for roughly 37 million mortgage loans that are already owned or backed by Freddie Mac, Fannie Mae and the FHA, $46 billion in savings could be the result (Wall Street Journal).

Ryan Guina is an entrepreneur and writer. He has worked for Fortune 500 companies and served six years in the USAF. He writes about money management and small business topics at Cash Money Life and military money topics at Military Finance Network. You can follow his twitter feed.

If you are interested in refinancing your home because of the historically low mortgage interest rates now being offered by mortgage lenders, you need to be sure refinancing is for you before proceeding. In some cases, a refinance may be just the thing you need to do but in other cases a refinance can do more harm than good.

For those home owners who were unable to make their way into the mortgage modification program offered by the government, getting your mortgage loan adjusted at this point may become more difficult.

According to the Treasury Department, new guidelines were set in place on June 1 that will require loan servicers to verify the income and financial hardships of applicants before placing them into trial modifications. This adjustment will make it tougher for homeowners to receive temporary relief from their unaffordable mortgage payments. (CNN Money)

A report released by the Office of the Comptroller of the Currency and the Office of Thrift Supervision reveals that a homeowner who had a mortgage loan modified by the federal government’s Home Affordable Modification Program (HAMP) was more likely to miss fewer payments after the modification was complete.

In fact, according to the report, fewer than 17 percent of home loans modified under HAMP had missed at least one monthly payment and fewer than 8 percent had missed two months of payments.

Fitch Ratings, a N.Y.-based credit-rating agency, recently released a report that 65 to 75 percent of home loans modified through the Home Affordable Modification Program (HAMP) are likely to default. The reason that the report cited problems still occur after a modification is because the borrowers do nothing to solve the rest of their debt problems after getting help with their mortgage loan. In the end, most of the people who receive this type of help end up losing their homes anyway through a foreclosure or short sale. (CNN Money)

Are you thinking about refinancing your mortgage loan? You are not alone — the two most chaotic sectors of the American economy are the real estate market and the banking and financial services sector, and one point where they intersect quite prominently is the home mortgage.

That means that there could very well be blockbuster rates available for you to take advantage of, and it could behoove all homeowners to at least think about refinancing their home mortgage loans. If that’s you, then you will want to compare the varying mortgage refinancing rates out there, one by one. To do that, and to determine which one will save you the most money, you will definitely need to use a refinance calculator.

Where Are the Refinance Calculators?

Many homeowners have had their credit score plummet in the past year (due to job loss and the rise in their credit card debts)  found that they were  faced with mortgage loan dilemmas: to refinance their mortgage or not, and if it was even possible to refinance despite the job lost. If this is familiar to you or someone you know, you should be aware that there are ways to refinance your mortgage even if you have bad credit; but there are significant risks and possible dangers associated with bad credit refinance loans from lenders.

If you’re wondering what the dangers are of bad credit refinance loans, you would think it make sense that if you have bad credit and sky high debt, refinancing a home is a reasonable choice to lower monthly mortgage payments. However, the bad news is that bad credit refinance loans are pretty problematic. The reason is obvious, lenders prefer good credit consumers as they have less risk. So for bad credit consumers, lenders are wary to lend. Even so, some lenders still give people with bad credit the opportunity to refinance their home mortgages – just with lots of strings attached, including high interest rates and stipulations.

The thought of buying a home nowadays is pretty scary because the housing market has been so darned volatile in the past year. Who wants to really take a chance after so many ARM mortgages were issued leaving many facing foreclosure? Not to mention those innocent individuals who paid their fixed-rate mortgage religiously every month yet found themselves underwater, because foreclosures around them drove their property value so low that their mortgages went underwater – owing more than what the house was worth.

Yep, there’s no doubt that anyone who is thinking of buying a home for the first time is probably thinking twice. But according to a recent blog by MoneyRates‘ Richard Barrington, all of the volatility has created a good environment to buy your first home or refinance. And you know what? This actually makes good common sense.