 |
It's Up To 11.8% |
| |
 |
Dear Mrs. Edith Lank,
I am buying a home. I didn’t know at first I was getting this house on an adjustable ARM. Every six months like my payment goes up. I have asked this company about refinancing this house to place it on a fixed rate. They say your credit score has to be 500 or better. The score didn’t matter the first time they loaned the loan. The interest rate is up to 11.8 percent. Please advise me what to do. I need help on this one. – S. B., Rochester |
| |
| |
 |
Your letter is a perfect example of the kind of thing we’re hearing a lot about lately: Sub-prime (poorly qualified) borrowers getting sub-prime (high-interest) loans. When the borrowers can’t make their payments, they lose their homes to foreclosures. Then we hear lots of protests against what are called predatory mortgage lenders, those that take advantage of other people’s misfortunes.
But at least that loan did let you become a homeowner.
All you can do at this point is scramble to make the payments so you don’t lose the house, and work on getting your credit score up. Do everything you can: make payments on time, use cash whenever possible, and try to pay the full amount on your cards every month. If you can raise your credit score to just 580, you should be able to refinance with a favorable FHA mortgage. You might try a more mainstream lender at that point.
Just hang in there – and I wish you good luck. |
| |
|
Edith
Originally published on April 13, 2007 |
| |
| |
|
Back to Summary
|
< Previous | Next > |
| |
|
|
