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Can I Refinance An ARM to a Fixed Rate Mortgage-Even If I Have An ARM loan And Bad Credit

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By : Darin Sewell    99 or more times read
Within the previous decade lots of people employed adjustable rate home loans to acquire their new properties or refinance an existing home loan.

Many borrowers recently refinanced their ARM to a fixed rate mortgage as a way to avert the almost definite rate and payment increase.

Unfortunately there is a significant number of home owners who are not aware that the mortgage they currently hold will reset because they simply do not understand them.

For these borrowers the increase will be a real reality check and a likely budge crisis.

How Can I Determine If I Hold a ARM Loan

If you are unsure if the home mortgage you presently have is an ARM loan you will have to read your documents that you received at the closing.

There is a written document in the loan closing documents that is labeled the adjustable rate rider,if you see this in your packet then you hold an adjustable rate mortgage.

This form will list the conditions of your adjustable loan. Study this written document as it will tell you when your loan is supposed to reset and the amount of the first increase.

Going To a Fixed Rate Home Loan

Borrowers with an adjustable mortgage and good credit can refinance with today's low rates, but you are going to need a minimum of 5% equity in your dwelling to do so.

When you refinance with a fixed rate mortgage many times you will gain a lower house payment in addition to the extra benefit of a stable mortgage rate.

To receive the reduced interest rates getting through a standard mortgage refinance is all that is necessary.

What Can I Do When I Cannot Refinance

If for whatever reason you have no equity in your house or a bad consumer credit score and are unable to refinance your ARM to fixed rate mortgage you may be dealing with some trying situations.

To avoid these problems you must contact your mortgage lender and try to figure out a home loan modification with them.

If you have always been a reliable client loan holders will often times alter ARMS that are hard for home owners to make into more secure fixed rate mortgages.

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