Need to refinance, where do I start?

hybrid93hatch · #1 (**permalink**) 08-07-2009, 11:33 AM

My 5 year interest only (biggest mistake) will hit the 5 year mark next October. Since the value of my house is way under what I owe, it looks like I will be hanging on to it for a while.

I have a 80 / 20 loan with the 20 being a 20 year fixed rate. The 80% which is I believe 6.5% (right at 100k) is what needs to be refinanced.

My credit averaged 800 between the 3 last time I checked earlier this year. My income has increased slightly (about 95k), same month to month debt (car, phone, water, electricity, mortgage).

I have about 15k in my accounts. Would rather not use more than 10k for this process. The current lender will not negotiate, so I am ready to ditch them! It seems the rates are on the rise so I would like to get this done ASAP.

Thanks for any help you can offer.

sapphirecapital · #2 (**permalink**) 08-07-2009, 04:28 PM

If the appraisal is less than the mortgages you may not have a chance to refi beside paying up the difference, mostly the smaller community banks and cooperative banks may deal with this if you have the account with them, they follow different set-ups, allowing to engage in membership based lending when you have a certain percentage of the loan on deposit, it all depends, with your crdit and income you should be able to afford, however the reset can be murderous

Debt_mgt · #3 (**permalink**) 08-17-2009, 11:39 AM

Unfortunately this is the reality. No other lender is going to refinance a mortgage if they are being asked to finance more than the home is worth. They are looking for a strong equity position in addition to excellent credit. Since your payments are about to increase, you may qualify for one of the available programs that are out there. I would suggest speaking to someone at a HUD approved agency that specializes in foreclosure prevention to see if, once your payment adjusts, you would be put into a qualifying hardship.

If they determine that you won’t qualify, about the only other option may be to speak to an attorney that specializes in forensic reviews of your loan documents. If they can find violations in your documents (and this happens more often than you might believe) you may be able to negotiate from a much stronger position.

ezl123 · #4 (**permalink**) 09-08-2009, 09:10 PM

Try using a residential loan modification company. Just make sure you find a reputable one.

sussanesylvia · #5 (**permalink**) 06-01-2010, 08:19 AM

Start contacting lenders. Probably you might get one or more good solutions.

sussanesylvia · #6 (**permalink**) 06-23-2010, 09:34 AM

You need an advice of a professional who can guide you what would be the best option.

rice8702 · #7 (**permalink**) 09-07-2010, 05:31 PM

Will this situation you will not be able to refi. I wold not worry about it that much. You make good money and doing a refi on 100 k will not be that big of a difference anyway. But you do not have enough equity to do a refinance at this time.

DavidBeairsto · #8 (**permalink**) 09-07-2010, 10:28 PM

If you don't have an open account at a credit union get one. With your income two things are possible...
1. A loan from the credit union to cover the difference between the appraisal and the 80% needed to refinance
2. A home improvement that can level the current difference (doesn't always mean making your home bigger) a local Realtor is a good resource for exactly what would make your home more valuable to an appraiser

BankAim · #9 (**permalink**) 09-10-2010, 03:42 PM

Tough spot (which tons of Americans are in). No lender will touch your mortgage as is. Using your own money and the Credit union sounds like the best bet.

Ask your friends if they have used a mortgage broker or loan officer that they liked and trusted. A loan officer can shop around your situation to many different lender and if they are educated they can help you save as much of the money you have stored up as possible.

Good luck.

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