Knowing when to refinance and not to refinance is difficult for every homeowner, but after bankruptcy, the decision gets even tougher. There are a lot of different things that should factor into your evaluation, including your current finances, your credit score, and your ability to get approved. Here are a few tips to help you decide whether or not you should refinance your Oklahoma mortgage after bankruptcy:
Evaluating Your Finances
There are many advantages to refinancing a mortgage after bankruptcy. You may be able to get a lower rate, a lower payment, rebuild your credit, or get cash back at closing. Unfortunately, it will cost you to refinance. On average, Oklahoma borrowers pay $3,181 to close on a mortgage loan. If you can’t afford to pay for your refinance upfront or if this amount of money won’t override the amount you will be saving, refinancing may not be the best thing you can do for your finances.
Understanding Credit and Interest Rates
Finances aside, there are two other factors that will prove to be most important when deciding whether or not it is the right time for a post-bankruptcy Oklahoma mortgage refinance. These factors are your credit score and interest rates. The rate that lenders charge you will inevitably be affected by your credit score. The lower your score is, the more the refinance will cost you in interest. Before making the decision to refinance, you need to understand exactly where you stand with your credit score and how it will affect the rate that you are required to pay.
Surprisingly, getting approved for an Oklahoma mortgage refinance after bankruptcy isn’t that difficult. As long as your house isn’t worth less than the amount of your current mortgage, you shouldn’t have much of a problem. Most lenders, especially those in the sub-prime industry, will be more than happy to work with you to get you the refinance loan you’re looking for.