Mortgage can last a lifetime and that extra 1% can add up to literally thousands of dollars over the years. I have friends that are in their 70s and still paying off their home loans. It'll pay off in the long run to make sure you find the best deal possible. Don't let poor credit stop you from refinancing your home.
Make sure that your original mortgage does not have a pre-payment penalty or early payoff penalty of any kind. Sometimes people will get into their mortgage with the mortgage having a pre-payment penalty and they will not even know about it. Pre-payment penalties usually range from 6 months to 3 years with a penalty for an early payoff. The penalty is usually about the amount of 6 months worth of your mortgage loan interest, but this varies. You would have to be able to have some significant payment and interest savings on your refinance loan to justify refinancing a mortgage loan with a pre-payment penalty.
Ask the lender or broker for a comparison of the up-front costs, principal, rate, and payments with and without this rate trade-off.
Refinancing can be the right move to improve your financial situation, but be careful. Making the wrong move can put you much worse off. Smart and simple choices will go a long way toward keeping you financially secure.
Know your credit score before you begin looking for a loan. If you can, try to remove any blemishes from your credit report before applying for a refinance.