Mortgage Refinancing After Bankruptcy

If you are a homeowner with a recent bankruptcy and have been putting off mortgage refinancing, a new mortgage loan could help you rebuild your credit. It is much easier today to get approved with a recent bankruptcy than in previous years; however, it will take some work on your part to avoid overpaying for the loan. Here are several tips to help you avoid overpaying when mortgage refinancing after bankruptcy.

Mortgage Refinancing After Bankruptcy: Comparison Shop Online

The mortgage industry is extremely competitive; this means there are opportunities available to you that did not exist ten years ago. Having a recent bankruptcy no longer prevents you from refinancing your mortgage; however, the amount you pay depends on how savvy a shopper you are. Online search makes it easy to compare loan offers from a variety of different lenders. Watch out for "Computerized Origination Fees," as many sites like Lending Tree charge ridiculous fees for filling out a form on their site. Lending Tree is notorious for this and will charge you as much as $1300 while claiming there is no fee to you for their service. The bottom line with online mortgage refinancing is to carefully comparison shop and read all the fine print before you decide on a loan.

Mortgage Refinancing After Bankruptcy: Beware Retail Markup

Because you can expect to pay a higher interest rate when mortgage refinancing after bankruptcy, it is important to avoid paying any retail markup of this loan. Mortgage companies routinely markup the interest rate you qualify to boost their revenues. This markup by the retail mortgage company is called Yield Spread Premium and results in paying thousands of dollars in unnecessary interest each year. How can you avoid paying this markup of your mortgage interest rate?

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Posted in: After,Bankruptcy,Mortgage,Refinancing