Posted on: 30th Jan, 2010 07:29 am
i want to refinance my home to pay off credit card debt but my current lender turned me down after a long process because my score had fallen below 600. its currently around 550 as credt card companies began reducing my limits to the level of my outstanding balances. i have more than 200,000.00 in equity: mortgage balance 136,000., appraised value 360,000.00 as of march 2008. since that time, i have remodeled my kitchen and basement with cash and credit cards which put me in the current hole.
i am interested in a 15 yr mortagage. my income is about 60,000 a year. my savings amount to less than 5000.00 now. my credit card debt totals 23,000.00 with a few scattered late payments, but my mortgage payment history is perfect. i also have student loans totalling about 20,000.00 but they are currently in forebearance. if i could get rid of my credit card debt, i would be able to save for retirement and pay off my home in about 12 years. i no longer have 401k savings.
browngirl
i am interested in a 15 yr mortagage. my income is about 60,000 a year. my savings amount to less than 5000.00 now. my credit card debt totals 23,000.00 with a few scattered late payments, but my mortgage payment history is perfect. i also have student loans totalling about 20,000.00 but they are currently in forebearance. if i could get rid of my credit card debt, i would be able to save for retirement and pay off my home in about 12 years. i no longer have 401k savings.
browngirl
hi,
if your income has gone down to 550, it is going to be really difficult for you to qualify for a loan. most of the lender would want you to have a minimum credit score of around 620 to get you approved for a loan. your income is good. but you have a considerable amount of debts and it may affect your debt to income ratio. it will be really difficult for you to qualify for a refinance loan until you improve your credit scores and remove the negative items from your credit report.
however, have you thought of the option of filing bankruptcy? if you're concerned primarily with the credit card debt, you can file bankruptcy chapter 7 and have the unsecured credit card debt discharged. you can then reaffirm the mortgage on your home and keep making the monthly payments. the student loan cannot be discharged through the bankruptcy. so, you'll also have to make payments towards it once the forbearance period is over.
if your income has gone down to 550, it is going to be really difficult for you to qualify for a loan. most of the lender would want you to have a minimum credit score of around 620 to get you approved for a loan. your income is good. but you have a considerable amount of debts and it may affect your debt to income ratio. it will be really difficult for you to qualify for a refinance loan until you improve your credit scores and remove the negative items from your credit report.
however, have you thought of the option of filing bankruptcy? if you're concerned primarily with the credit card debt, you can file bankruptcy chapter 7 and have the unsecured credit card debt discharged. you can then reaffirm the mortgage on your home and keep making the monthly payments. the student loan cannot be discharged through the bankruptcy. so, you'll also have to make payments towards it once the forbearance period is over.
i'm alarmed at the mention of bankruptcy here. nowhere has browngirl made mention of difficulty, save for the reference to a few scattered late payments. that's not something that's about to lead to bankruptcy being the solution.
you may just have to wait out the credit scoring situation, bg. though you may find lenders willing to take on your risk, i'm afraid you'll find that rates won't be especially favorable. that may still make it worth your trouble, if you can stand paying higher than market rates to get you out of your bind.
you may just have to wait out the credit scoring situation, bg. though you may find lenders willing to take on your risk, i'm afraid you'll find that rates won't be especially favorable. that may still make it worth your trouble, if you can stand paying higher than market rates to get you out of your bind.
