Refinancing can often save you money over the long run, but if your credit has gotten worse since the time you obtained the loan, refinancing may not be the best idea. If your credit has improved since you got your original loan, then refinancing might be in your best interest.

The key is to do the math on your own. While most lenders are very helpful and have a vast base of knowledge in the financial world, they’re still here to make a sale. In other words, asking a lender “is it a good idea for me to refinance?” won’t always get you a straight answer.

Weigh the difference between the rates you qualify for and the closing costs for the new loan, and make sure you’re actually coming out ahead by refinancing.

If you’re in the condition where you need to refinance – Whether it’s for a cash-out, or because of impending foreclosure – There are options that are available to bad credit borrowers.

One little-known option is the FHA backed refinance. While many borrowers know that you can get an FHA loan to buy a house, not many know that the FHA also backs refinances.

Find a lender that works with FHA loans and discuss your options. With an FHA loan, you can often get approved even with bad credit, reduce your down payment, and even get a better rate.

With an FHA backed refinance, instead of judging your application based on your FICO score, the FHA judges based on your credit history. In other words, they make their call based on your debt patterns over the last 12 months or more. This also gives you the chance to explain any blemishes on your credit report. For FHA loans, in Boise, Nampa and surrounding areas - call Lisa, your local friendly Idaho Home Mortgage loan expert.