If your is under 500 and you need to refinance your mortgage you have severely limited options when compared to someone with a over 500. Most sub prime lenders will not accept a below refinance loan from a under 500 borrower. However all hope is not lost and you do still have some options to refinance even with a under 500.

One option many under 500 refinance borrowers turn to is a hard money lender. Hard money lenders are typically equity driven and do not look at credit score. They are mainly concerned with making in the short term, therefore many hard money loans will have interest rates over 10% and many will have funding fees of up to 5% of the loan amount. You will however need 30-40% equity in your home to secure a hard money loan. All though not cheap they can help you refinance with a under 500 to get cash out to pay off debt or stop a foreclosure.

Another not so widely known option for a under 500 refinance is an FHA loan. FHA is backed by the federal government does not have any actual minimum requirements, instead they look at overall credit profile. This type of underwriting is just what the below 500 refinance borrower needs. With a FHA refinance you will need to prove financial   responsibility and explain why your is under 500. For example if your is under 500 due to medical bills but all your other payments were on time then FHA more then likely will help you with a under 500 refinance. You will however have to show valid proof of positive payment on your consumer credit accounts. FHA will even accept payment history on alternate credit accounts such as the cable bill, electric bill and cell phone bills. What FHA will not accept for a under 500 refinance is a borrower who just did not pay their bills and was irresponsible.

The best option for a homeowner with a under 500 is to find a local FHA refinance expert and talk to them about your situation. Many times based off experience they should be able to tell you if your under 500 refinance will be FHA approved or not.