Responsible borrowing and spending is a necessary part of bankruptcy recovery. In some cases, it could take years to rebuild your credit. If you are interested in speeding up the process, you may want to try refinancing your Vermont mortgage after bankruptcy. Refinancing can improve your credit in as little as two years.
Preparing to Refinance
There are two main deciding factors when it comes to getting approved for a Vermont mortgage refinance after bankruptcy: a steady income and a steady history of bill payment. Some lenders will want to see a two-year span of on time payments, others will be more flexible. The income factor, on the other hand, is non-negotiable. Any lender you work with will want to see that you can afford the loan before approving you.
While just establishing a new loan through a Vermont mortgage refinance after bankruptcy will help to improve your credit, lowering your monthly payments with a better interest rate or better terms will be even more important. If you can manage to lower your mortgage payment, you can use any extra you save to put towards other debts. This may help you with your bankruptcy repayment plan or help you to pay other monthly bills. By paying all of your bills on time every month, you can significantly improve your credit score.
Making Your Monthly Payments
After taking out a new Vermont mortgage refinance after bankruptcy, it is imperative that you make all of your monthly payments on time every month. If you can do this for at least one year, you will see a huge boost in your credit rating. After two years of solid payments, your credit score will be much closer or even up to 706, the average credit score in Vermont.
Visit Vermont Lending Center to see our Recommended After Bankruptcy Mortgage Refinance Lenders Servicing Vermont , whether you are looking for home purchase, refinance or a home equity loan.