Posted on: 04th Apr, 2009 01:41 pm
we'd like to move to a larger home. current house (no appraisal - zillow says 300k value which i consider about 100k undervalued) has 60k balance with 8 years remaining @ 6.51%, $871.66/mo. new house is 375k. would like to put 20% down to avoid pmi (won't qualify for deduction based on income). option 1: refinance and 90k cash out. problem: the cash out will be fully taxed? (27% = 24k). option 2: 80/10/10 and interest tax deductible. which is better? any other options? current house will be rented until home prices are better. will likely stay in new house for at least 8 years. fico 740 - 780. thanks.
Hi Guest,
Under current market scenario, it is difficult to qualify for a new mortgage while you have an existing one on another property. What is your income like? I mean, would you be able to afford two mortgage payments simultaneously? I think you should try and sell the current house and pay off the existing mortgage balance. This will help you improve your credit further and would also provide you with money to make a considerable amount of down payment on the new loan which will lower your interest rate.
Under current market scenario, it is difficult to qualify for a new mortgage while you have an existing one on another property. What is your income like? I mean, would you be able to afford two mortgage payments simultaneously? I think you should try and sell the current house and pay off the existing mortgage balance. This will help you improve your credit further and would also provide you with money to make a considerable amount of down payment on the new loan which will lower your interest rate.