refinancing 10.85% rate

What does a higher rate have to do with wither or not you will pay them back.
how does a higher rate insure that you will pay them back?
It's a rip-off tactic plain and simple!

 

A higher rate doesn't insure anything. The reason for the higher rate is the lender preceives more risk than normal and wishes to be compensated for it.
As to the posters question. It all depends on how your post bk credit looks as well as your income and expenses. It wouldn't hurt to make some inquiries. You'll never know unless you ask.

 

When did you get your Mtg? Most likely, as a 'high risk' person, they also slapped you with a 'pre-pay' penalty to keep you from refinancing for 3-5 yrs.

I have the same rate, also getting out of a 98 BK7. I am going through refi now. If you have paid all your mtg payments on time with no lates for a year, you will most likely be able to refi for a better rate. If your other payments (cc, auto, etc) have been on time as well, you will get a good rate.

The pre-pay may not be 'that' bad, it depend son how long you are going to keep your house.

An example......

Say you owe 150,000 and had a three year pre-pay penalty. Lets guess you closed the first of 2000.00. An average pre-pay penalty (most regulated by state) would be about 6000.00. Now, that sounds like a lot, HOWEVER, if you were to refi to a 'normal' 7% or so rate, you would save almost 4k the first year, even after the pre-pay penalty. The longer you plan on staying in the house, the better the savings. You also need to factor in your tax savings... penalties and interest on your house are a write-off.

Full Spectrum Lending is writing B/C paper right now at between 7.5 and 9%, depending on your credit and state. If you are going to stay for at least teo years, you are gonna save some money. They will add another pre-pay, though, 3-5 years depending on your rate. Di-Tech is higher and won't touch BK.

Hope this helps!

Shawn