Why to Consider a Bad Credit Remortgage
There are many situations that can make it beneficial to obtain a bad credit remortgage. Here are some reasons you might want to consider remortgaging, even if you have bad credit.
1) You have a balloon payment coming due. If you fail to pay the balloon when it comes due, the lender could foreclose on you. If you have a balloon, you should try to remortgage as soon as possible.
2) You will save money by remortgaging. Since interest rates have dropped, it may be that you can get a lower rate even with bad credit. If the new loan will be at least two points lower, it may be worth it to remortgage your home.
3) You have an interest-only loan. As long as you keep your current mortgage, you are not paying anything toward the principal of the loan unless you pay extra. You can keep paying your payments on time forever and never own your home.
If you are in any of these situations, you may benefit from getting a bad credit remortgage even though the fees are higher than you would pay if you had good credit. Your payments may be higher if you remortgage to eliminate a balloon or interest-only loan, but as long as they are not so high that you can’t make them, you will probably be better off with the bad credit remortgage.