Consumers all across this great nation are bewildered by difficulties and restrictions that come with refinancing your mortgage these days. With less options available for cash out, many borrowers are forced to refinance their $500,000 mortgage when they only need $40,000 cash out. Just last year, you could get cash quickly with a home equity loan or credit line. Unless you are exhaling equity, most lenders will require a full mortgage refinance for any type of cash out. If you have more than 20% available equity in your home, then you can get a 2nd mortgage without refinancing your 1st mortgage, but with the declining home values lately...Who has equity in their home.

It is easy to get confused but there is nothing wrong with getting home financing advice from several loan officers and financial advisors. Another dilemma for many bad credit homeowners is fixed rate refinance loans that offer cash back. Millions of consumers have their adjustable rate loans set to adjust in the next twelve months, but the mortgage lenders simply do not have loan programs to refinance these borrowers with. It look like this next year will break records for home loan defaults, foreclosures and personal bankruptcies.

FHA has offered some good refinancing options for people with bad credit, but because of the loan limits in high cost regions, only a fraction of homeowners will qualify for a FHA refinance loan. According to loan officer Brendon Daly, "homeowners must address the following questions before refinancing their home.

1. Does you Loan-to-Value qualify you for mortgage refinancing?

2. Does your credit score meet lender requirements for refinance loans?

3. Can you document your income to meet Debt-to-Income requirements from underwriters?

Mr Daly warns homeowners to know their qualifications before applying for a refinance or home equity loan online. It is a good idea to discuss your goals, qualifications and budget with a loan officer who has experience. The home financing market is changing, so you need to align yourself with financial advisors who will not waste your time or money.

With increasing mortgage rates and decreasing home values, its not easy to take out a home equity loan or refinance your existing mortgage to simply get cash out. Bottom line you better have money in the bank and solid cash flow each month, because it is not a good time to sell your home.