A lot of us, these days, are wondering what really affects us when we try to Refinance Homes. Since conventional and fha loans are the two basic avenues, deciding which one might be the best choice for you may require you to think about your credit score.

Even with the low interest rates of today, funds for refinancing homes are starting to dry up and those juicy low rates that lenders are advertising are only available to a select few. Which few? Those of us with a minimum credit score of 700.

The purpose of credit scores is to numerically define the degree of credit risk. So, what is it that helps or hurts our credit score?

I’m so glad you asked. There are a couple of basic things that are under our control that lower our credit scores. You all know the first one: Making a monthly payment more than 30 days late will definitely affect it, and if that payment is your home loan payment, even worse. Second: Maxing out a credit card will cause your score to plummet, also.

There are other factors involved also, but I think those two are enough to worry about for the time being.

Now, in order to get your credit score you usually have to spend a little money but you can get a copy of your credit report free at http://www.annualcreditrepot.com Annualcreditreport. Federal law allows you to get a free copy from each of the 3 major credit reporting agencies annually. So when you get there, request your copy from Equifax, Experian and TransUnion.

Remember, I stated earlier that your credit score might help you choose between fha and conventional? Well, if your credit report includes some of the factors that will indicate a lower credit score, there’s still refinancing help available to you.

That help comes in the form of Fha. First of all, they don’t put as much emphasis on your credit score as a conventional lender does. And secondly, if you currently have an fha loan they have a "Streamline" program that doesn’t even require you to document your credit or income history. There are some restrictions so this may or may not be available to you. You just need to discuss the facts with the lender you choose.

When searching for lenders who Refinance Homes, be sure and check not only the interest rates but also the fees that each one charges. That way you can compare total costs between lenders.

P.S. Always gather the figures you need on the same day as rates do fluctuate on a day to day basis.