Refinancing Can Be a Great Way for Homeowners to Get Out from Under Staggering Bills – But It Doesn’t Always Work

There are two main ways that refinancing might enable you to manage your mortgage payments going forward: rolling in past-due sums to allow you to start again with a single, manageable monthly payment and reducing your mortgage payments each month. For many people, filing bankruptcy is the better long-term solution.

Read on to learn ways in which refinancing could help your financial situation. Then contact Law Offices of Terrence Fantauzzi at (909) 552-1238 for a consutlation with a bankruptcy attorney who can help you determine the best way forward for your situation.

Refinance to Catch Up Past-Due Payments

If you’ve gone behind on your mortgage payments and are unable to catch up, even though you have adequate income to make your usual monthly installments, refinancing could seem like a decent alternative. Yet, there are dangers.

The first is a direct result of you being in arrears with your mortgage payments. It’s likely that the delinquency has already harmed your credit score if it’s severe enough that you’re thinking about refinancing to catch up.

If this is the case, refinancing can prove challenging for you. Also, you might pay additional fees and interest if you can refinance; the interest rate you’re given might even be higher than your present rate. Other solutions might be better in this circumstance.

For example, you might look into obtaining a modification of your current mortgage loan or contemplate Chapter 13 bankruptcy. With the help of Chapter 13, homeowners can frequently catch up on past-due mortgage sums over the course of three to five years without facing the threat of foreclosure.

Bringing Down Mortgage Payments Each Month

A refinance can cut your mortgage payments in two ways: by lowering your interest rate, or by extending out your payments over a longer period of time. Finding out about the rates and fees that are available to you can help you make an informed decision about refinancing to reduce your monthly obligations. It’s crucial to consider additional factors besides the monthly payment.

What is the Best Solution for Your Situation?

If you are having trouble making your monthly mortgage payment, there are solutions other than refinancing. Whether you don’t qualify for a refinance, you don’t want to extend your loan period, or you simply want to know more about the options available to you, contact Law Offices of Terrence Fantauzzi at (909) 552-1238 for a bankruptcy consultation.

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