Today&39;s reader question is unfortunately one we&39;ve been hearing more and more lately. Lisa wrote in this morning with an ARM mortgage crisis:

I need help! My mortgage is not fixed and the rate reset is coming up in September.  I have bad credit and I think no way to refinance -- Please help!

It sounds like Lisa could end up as another victim of the current mortgage crisis if she&39;s not careful (The New Yorker has a great short article that explains the subprime mortgage industry problems online). Luckily, she still has five months before her adjustable rate mortgage resets. This should be plenty of time for her to evaluate her option and take action.

Step one should be to order all three of her FICO credit scores online immediately. The nice thing about mortgages is that they have more relaxed standards when it comes to credit scores than other lenders. A credit score in the 600&39;s that would be considered "bad" for an auto loan or credit card, can actually qualify for a prime home loan in many cases. Lisa&39;s credit may not be as bad as she thinks.

The next step is to find a reputable mortgage broker in your area. Look for someone who has been in the business for a very long time and who comes highly recommended. This broker can help you find refinance options to fit your credit score and situation. Mortgage rates are still pretty low, so refinancing as soon as possible may be the best choice.

If you cannot or do not want to refinance, there are some decisions to be made now.  You might be able to afford your higher reset ARM payment for a while while you work on your credit score, crunch some numbers to see if this is an option. If not, you might need to think about selling the home. A good credit counselor or financial adviser can help you figure out what to do if refinancing isn&39;t an option.

Lisa is smart to be thinking about her mortgage future now, before she gets in trouble. However, there are a lot of homeowners out there who don&39;t have the luxury of time. If you are already defaulting (not paying on time) on your mortgage, you need to get serious now. Our blogger, Gerri Detweiler, wrote a fantastic article called "How to Save Your Home from Foreclosure" that is a must-read for anyone already in mortgage trouble.

Next question? Send your questions to us by email at tidbits@credit.com or post them in the comments section below. Randy Johnson, a 15-year veteran mortgage broker, is on hand to help answer your home loan questions.