Sat. Jun 3rd, 2023

Financing your mortgage may feel like an impossibility if you have poor credit; however, there are still many paths to take when attempting to refinance. In this blog, we’ll review 8 options for people who want a home loan refinance but have not-so-perfect credit scores.


For individuals with poor credit ratings, FHA Streamline Refinance loans provide an ideal option because you won’t be subjected to a credit check. Instead, the loan is based on your current mortgage balance and payment history. To qualify for this type of loan, you must have had at least six months of payments made on time and meet other requirements. You also need to prove that the refinance will provide a net tangible benefit to you.


Veterans who have VA-backed mortgages may be able to take advantage of VA Streamline Refinance loans. These loans do not require a credit check or proof of income, which can be beneficial if you have bad credit. However, to qualify for a VA Streamline Refinance loan, you’ll need to meet specific requirements, such as current loan-to-value ratio and other criteria.


Mortgage modification programs are designed to help homeowners struggling to make their mortgage payments due to financial hardship. If your credit score has been affected, you may be eligible for loan modification. Don’t let a few mistakes keep you from taking advantage of this opportunity! These modifications lower your monthly payments or extend the term of your loan — both of which can help with bad credit.

1. HARP Program –

Homeowners who are struggling with little or no equity in their homes can take advantage of the Home Affordable Refinance Program (HARP) and refinance their mortgage loan at a competitive rate, supported by the government.HARP is designed to help current borrowers with their payments but have been unable to qualify for traditional refinancing due to a lack of home equity or a decline in the home’s value since they purchased it.

  • HARP loans do not require an appraisal, so borrowers can refinance without needing to prove their home’s current value.
  • HARP loans are available for up to 105% of the home’s value, making them accessible even if your home has declined since you purchased it.
  • Borrowers with bad credit may qualify for a HARP loan as long as they have a good payment history on their mortgage and meet other eligibility requirements.
  • This beneficial program shields you from the extra expense of private mortgage insurance (PMI).

2. FHA Streamline Refinance –

If you have an existing FHA-insured mortgage, take advantage of the Federal Housing Administration’s (FHA) streamlined refinance program specially designed for you. This program allows homeowners to lower their monthly payments and reduce the interest rate on their loans without requiring an appraisal or any other documentation other than proof of income and employment history.

3. VA Streamline Refinance –

The U.S. Department of Veterans Affairs (VA) also offers a streamlined refinance option for veterans and active duty military personnel with existing VA-backed mortgages. This program requires no appraisal or credit score check and can result in lower monthly payments and reduced interest rates for eligible borrowers.

4. USDA Streamline Refinancing –

The U.S. Department of Agriculture (USDA) also offers its streamlined refinancing program designed explicitly for rural homeowners with existing USDA-backed mortgages who are current on their payments but have seen an increase in their budget due to increasing mortgage rates or changing financial circumstances since they took out the loan initially.

5. Energy Efficient Mortgages –

EEMs offer to finance specifically tailored toward making energy-efficient improvements to your home, such as installing new windows, insulation, solar panels, etc., allowing you to save money on your utility bills while still reducing your overall loan balance over time through energy savings alone!

6 . Non-Prime Lenders –

Non-prime lenders specialize in providing financing solutions to borrowers who may not meet traditional lending requirements due to less-than-perfect credit scores or other unique circumstances such as self-employment, recent bankruptcy filings, etc. These lenders often offer competitive rates and flexible terms tailored toward helping borrowers get back on track financially without getting taken advantage of by predatory lenders offering high fees and exorbitant interest rates as “solutions” when trying to secure financing elsewhere would be futile due to poor credit scores or other issues preventing them from qualifying under traditional lending guidelines established by central banks and financial institutions alike.

7 . Credit Unions –

Credit unions are another great source of financing if you have bad credit because they often place more emphasis on factors like income stability and character rather than just focusing solely on credit scores when approving applicants for loans; plus, many times, credit unions will offer better rates than what you’d find at most banks!

8 . Hard Money Lenders –

Hard money lenders are private individuals or companies that lend money based solely on the collateral you provide rather than your credit score; however, these loans usually come at much higher interest rates, so be sure you understand all the terms before signing anything!


For people with bad credit looking to refinance their mortgages, there are still plenty of options available if you know where to look! From government programs like HARP and FHA Streamline Refinances down the line through hard money lenders, there is something out there that should fit everyone’s needs regardless of your current credit score standing! So don’t give up hope if you’re struggling—with a little bit of research online, there’s bound to be something that fits what you need financially! Intended Audience: People who have bad credit but need assistance refinancing their mortgages

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