Subprime Mortgage Refinance And Subprime Home Equity Loans

Subprime Mortgage Refinance And Subprime Home Equity Loans



Subprime Mortgage Refinance And Subprime Home Equity Loans
If you​ have credit problems in​ your past and a​ low credit score,​ if​ you​ decide you​ want to​ refinance or​ get a​ home equity loan,​ you​ will probably need to​ work with a​ subprime mortgage lender .​
Subprime mortgage lenders are willing to​ work with those with lower credit scores and past credit problems .​
They charge interest rates that are slightly higher than the​ prime rate .​
When you​ work with a​ suprime lender,​ you​ will need to​ be careful of​ a​ few things .​
Subprime mortgage lenders sometimes take advantage of​ borrowers with poor credit and charge excessive fees or​ offer terms that are not reasonable.
Be careful of​ these things when applying for a​ new refinance or​ home equity loan:
1 .​
Watch Out For the​ Pre-Payment Penalty - Most sub-prime mortgage loans have a​ pre-payment penalty attached .​
That means that if​ you​ decide to​ either sell your home or​ refinance your home anytime within the​ designated period of​ time,​ you​ will have to​ pay a​ penalty which is​ usually equal to​ about 6 months of​ interest or​ mortgage payments .​
If you​ are ok with a​ pre-payment penalty,​ make sure you​ know exactly how long that allotted amount of​ time is​ and exactly how much the​ penalty is​ .​
a​ penalty is​ usually for anywhere from 6 months to​ 2 years .​
But,​ a​ penalty that is​ two years or​ longer,​ in​ some cases,​ might be considered excessive.
2 .​
Watch Out For Junk Fees - Many times in​ sub prime mortgage loans,​ a​ broker will tack on​ excessive fees that are not completely necessary .​
Have your mortgage broker go through all of​ the​ fees one by one and make sure you​ understand where all the​ fees are going .​
Educate yourself on​ what fees are completely necessary and which ones are not .​
Go to​ www.mortgagesanity.com for a​ list of​ junk fees that sometimes get added to​ mortgage loans .​
Also,​ educate yourself on​ the​ average cost of​ such fees to​ avoid being charged an​ excessive amount.




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