You may still find lenders in the sub prime market that will offer you decent rates, if you approach the matter cleverly. You can shorten your repayment plan to get a lower rate and you may also negotiate the terms of payment and interest rates. Various factors are what build up your home equity loan rate. You can apply for a home equity loan with a balloon payment and once it is sold you pay back the loan. The local Bank they work with will not agree to lend the money because they think that the borrower won't be able to pay back the loan and therefore, in risk. You can still negotiate the terms easily. Fact is that it doesn't have to be too complicated all you really need to know is how much you can pay per month and find the best lender. Remember that by refinancing your house acts as collateral meaning you are in the risk of losing it if you default the mortgage. Sub-Prime lenders will even quote decent rates to consumers that can prove that they can keep up with repayments, just to make an additional sale. On the other hand if you've got a raise, found a higher paying job or in general more income, you might want to pay a larger monthly payment, thus reducing your repayment period. For example you choose a 10 year ARM with a 5 year fixed rate. Depending on the period you would like your refinance repayment choose the type of rate.