How Atlanta Homeowners Can Lower House Payments Without Refinancing
Hoping for a lower house payment but not sure if you qualify for a refinance? You've still got options, say Atlanta bankruptcy attorneys.
With interest rates still relatively low, many homeowners are trying to refinance for a better payment and terms. Unfortunately, not many actually succeed. Not only is the process of refinancing expensive and time-consuming, it's also increasingly exclusive. Thanks to tightening credit requirements, it's almost impossible to qualify for a refinance without a good credit history and a well-paying job. But that doesn't mean you have to keep struggling to make your current mortgage payment.
Sure, you may not be able to lower your payment by reducing your rate. But what if you could lower your payment by reducing your principal? There are two ways to go about it. First, you can do like a small number of homeowners and pay more than you need to each month, lowering your principal in the process. Of course, while this method shortens the term of your loan, it won't actually lower your payment in the meantime. Recasting your mortgage, on the other hand, will reduce your payment.
By paying a lump sum and requesting that your lender recalculate - or "recast" - your loan, you can lower your mortgage payment and the amount of interest you pay. In other words, you can get the same results as with a refinance, minus the cost and credit requirements.
Unfortunately, not everyone is able to come up with enough upfront cash for a recast - most lenders require $5,000 minimum, but it can take tens of thousands of dollars to knock enough off your payment to make a real difference. If you've just inherited some money or received a big bonus at work, recasting your mortgage might be a wise way to put it to use. But if not, you're out of luck - though not out of opportunities.
There may be a way to make paying your mortgage easier without actually changing your payment size - bankruptcy. If you're anything like most folks, you've probably got medical bills, credit card bills or a car loan (maybe all three) eating into every paycheck. With bankruptcy, you can make eliminating those debts possible, in the process freeing up more money to pay other bills, like that mortgage. Learn the truth about bankruptcy and how filing can rescue your finances when you try a free one-on-one debt analysis with an Atlanta bankruptcy attorney.