Finding the lowest rates on a bad credit mortgage will save you
thousands of dollars. Even with poor credit, you can find near market rates by
picking the right home financing terms and lender. A quick online
search will yield dozens of mortgage quotes for your inspection. In no time
you can find a home loan that fits your budget needs.
Set Yourself Up For Low Rates
Sub prime lenders have developed a surplus of financing packages to
meet the needs of practically every lender. Within this plethora you will
find terms specifically design for lower rates.
Adjustable rate mortgages offer the lowest rates, at least in the
beginning. You can also select caps with this type of mortgage to protect
yourself from future jumps in rates and payments.
Shorter terms and large down payments will also help you secure lower
rates. Usually a 15 year loan rate will be .4% to .2% lower than a 30
year loan. That is a difference of thousands of dollars. Down payments
also discount your interest rate, especially is your payment is 20% or
more.
In addition to these factors, you can also purchase a lower rate by
paying points at closing. In order to save money with this option, you
need to keep your mortgage for at least seven years in most cases.
Interest Rates Lower With The Right Lender
Picking the right lender is just as important as picking the right home
loan terms. To protect yourself from fraud and dodgy lenders, it is
especially important to research several lenders when dealing with bad
credit financing.
Start your home financing search with recommended lenders. Request
quotes for the same type of loan from several different lenders. This will
help you sort through all the lenders without hurting your credit
through needless credit checks.
When comparing loan offers, the APR will show who has the lowest
costing loan. However, be aware that some lending companies will charge
higher closing fees for lower rates. This can mean a real savings if you
keep the original mortgage for several years. But if you move or
refinance, you will be out that money without seeing a real savings.
Carrie Reeder offers advice and referrals for
Poor Credit Home Loans.
View all of our Recommended Bad Credit Lenders.
