Posted on: 30th Mar, 2004 03:55 am
Most people choose to refinance either to get a lower rate compared to what they have received on their existing mortgage or to modify the term of the loan. Besides, they often require extra cash for a variety of purposes and here's where refinance can help them to cash out their equity. This article gives you an idea of the following aspects of refinance:
Now that you're aware of the different ways by which you can refinance your current loan, you need to decide upon the loan program that can fulfill your purpose of refinancing and help you save the maximum.
It's better if you can shop around and apply for mortgage quotes with a number of lenders. This will make you aware of the rates and trends prevailing in the market. It will give you an idea on what the mortgage rates are likely to be in the forthcoming days. You can then go for the right loan program keeping in mind your needs as well as what the market trends are likely to be in the near future.
- 5 ways to refinance your existing loan
- Loan types to choose for refinance
5 Ways to refinance your loan
- Rate and Term Refinancing
This allows you to borrow enough to clear your current mortgage balance. You can either modify the interest rate on your loan or change the loan term or you may adjust both. For instance, you may change to an FRM when the rate on your ARM is expected to move upwards within a short time. Or else, you may switch over from an FRM to a hybrid ARM if you plan to move out within a period of 2 to 3 years. - Cash-out Refinancing
This is one of the home refinancing options which will leave you with excess cash amount after you have paid off the current loan balance. You can thus extract cash proceeds from your home equity. Know more... - Streamline refinancing
Streamline refinancing refers to the documentation and underwriting carried out by a lender in order to find out if the borrower would qualify for a refinance loan. This is a kind of loan program does not require any credit verification. But it may or may not require an appraisal. There are two types of streamline refinances - one offered by the FHA and the other by the VA. Know more... - Mobile home refinance
You can avail mobile home refinancing loans in case you wish to in order to get a lower interest rate on your mobile home mortgage loan and enjoy making some savings out of it. You can opt for a Title I loan program provided the mobile home is your primary residence. There are some criteria which you need to fulfill in order to get a mobile home refinance loan. Know more about the eligibility criteria. - Low Credit Refinance
You may have a number of loans including credit cards, personal loan or even a mortgage and are not able to pay them off in the right time. This is when your credit score starts going down and now if you look forward to a refinance, you may be perceived as a low credit borrower.
However, inspite of low/bad credit, it is possible to qualify for a mortgage. But there are lenders who may require you to pay a higher rate of interest on the refinance loan compared to what you had to pay had your credit score been a favorable one. However, bad credit loans provide you with an option to rebuild your credit while you make regular payments on the refinance loan. At times, you do need these loans in order to consolidate and eliminate other debts, provided you take out extra cash through the refinance - the process being known as cash-out refinance. Know more on Bad credit refinance.
Now that you're aware of the different ways by which you can refinance your current loan, you need to decide upon the loan program that can fulfill your purpose of refinancing and help you save the maximum.
Loan types to choose for refinance
There are various loan options available in the market. You need to choose from the options depending upon your finances and the situation you are in. We have given a list of the situations and the loan options one may go for if he wishes to refinance.
| Your Situation | Favorable Loan programs | |
| Require cash | Home equity loan | |
| Home improvement | Home equity loan/Line of credit | |
| Need loan amount below $300,700 | Conforming fixed rate loan | |
| Need above $300,700 | Jumbo fixed rate loan | |
| Plan to stay beyond 5 years | Fixed rate loan | |
| Wish to sell within 5 years | Adjustable rate of mortgage | |
| Add a room or other improvements at home | Cash-out refinance | |
| Buying a vacation home | 30 year fixed rate |
It's better if you can shop around and apply for mortgage quotes with a number of lenders. This will make you aware of the rates and trends prevailing in the market. It will give you an idea on what the mortgage rates are likely to be in the forthcoming days. You can then go for the right loan program keeping in mind your needs as well as what the market trends are likely to be in the near future.
Related Readings
I lost my job,do to company closing.What can I do about getting help. in payng my mortgage?
Hi chuy!
Welcome to forums!
You should contact your lender and inform him about your financial situation. If you do not want to save your property, you should apply for a deed in lieu of foreclosure. This will help you in selling off your property and you won't be liable for the deficient amount resulting from the sale of the property.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
You should contact your lender and inform him about your financial situation. If you do not want to save your property, you should apply for a deed in lieu of foreclosure. This will help you in selling off your property and you won't be liable for the deficient amount resulting from the sale of the property.
Feel free to ask if you've further queries.
Sussane
You absolutely can. Just contact one of the qualified loan officers on this site for a rate quote.
I would like to streamline a loan on a 1977 single wide in washington state can you help? 253 347 2110
Get in touch with your present lender and apply for a streamline loan. He will be able to help you in the best way.
Dear Pat,
You inquired about a refinance loan for a MH that was built in 1974.
These are termed Pre-HUD Mobile Homes since they were built before June 15th, 1976 which is the date that legislation took effect that mandated HUD to govern the construction and safety standards of MH's.
Here are the current factors which apply to the few investors in this type of paper that we know of still in the market.
Of course the other normal lending criteria come into play like income, debt ratios, comparable sales for an appraisal, etc.
We would highly recommend that you ask any potential lender/broker about their guidelines on these issues before you let them pull your credit and most especially before you give any money out of pocket (i.e. appraisal fees).
Hopefully this helps you take some of the frustration out of the process on this property type.
You inquired about a refinance loan for a MH that was built in 1974.
These are termed Pre-HUD Mobile Homes since they were built before June 15th, 1976 which is the date that legislation took effect that mandated HUD to govern the construction and safety standards of MH's.
Here are the current factors which apply to the few investors in this type of paper that we know of still in the market.
- Location: These loans are easiest to get done in California. Right now that is the only state where we know of regular closings (the important part of the loan).
Home Type: Mutli-Section Homes are easier to get accepted (Doublewides, Triplewides, etc).
Land/Home or Chattel: Meaning are you financing the land with the house or is the house in a park or leased lot? The answer to this might surprise you in that there are more programs available for these types of homes in a mobile home park than if the land is deeded with the house.
Loan Purpose: Right now we are only seeing refinance programs that allow for Rate and Term Reduction. NO CASH OUT or Debt Consolidation.
Credit: Since the mobile home is not very strong collateral in this loan you will need very good credit to be considered.
Of course the other normal lending criteria come into play like income, debt ratios, comparable sales for an appraisal, etc.
We would highly recommend that you ask any potential lender/broker about their guidelines on these issues before you let them pull your credit and most especially before you give any money out of pocket (i.e. appraisal fees).
Hopefully this helps you take some of the frustration out of the process on this property type.
I have a reverse mortgage and would like to refinance to pay off debts and have cash out can I do this in maryland
Hi Inez,
You can contact your reverse mortgage lender in Maryland and apply for a refinance. If you meet the required criteria of the lender regarding refinance, then you would be able to go ahead with it.
Take care.
You can contact your reverse mortgage lender in Maryland and apply for a refinance. If you meet the required criteria of the lender regarding refinance, then you would be able to go ahead with it.
Take care.
This information is very helpful. Thanks for posting.
We purchased a home 3 years ago with a 80/20 all interest loan. We have high income and stable jobs and want to refinance to a lower rate. The house has not appreciated or depreciated in value. We plan to stay in the house forever. Are there any options to re-finance?
Hi st!
Welcome to forums!
You can contact your present lender and check out if he can help you in refinancing both the loans into one and give you a lower interest rate. As there is no equity in the property, it'll be completely the lender's discretion whether or not he would consider your request.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
You can contact your present lender and check out if he can help you in refinancing both the loans into one and give you a lower interest rate. As there is no equity in the property, it'll be completely the lender's discretion whether or not he would consider your request.
Feel free to ask if you've further queries.
Sussane
I own a 1 bedroom condo with a first and second mortgage I would like to do a combined refinance 10 or 15 year fixed rate. I owe $45520.78 for both loans Would you be able to help me
What is the condo worth? What are similar units in the area selling for?
Hi,
I am looking to refinance my home or maybe not, I am able to pay of my house but I am getting some advice to do refinance. My current monthly payment is 900 ish and I am on 50K now what I could pay of in few months. I am new in all this and I am not sure what should I do :(. Price of the house was 170K [I close on the house 7 months ago]
Some people say I should refinance and they try to explain why should I do that but I guess they don know how to explain
Thank you
I am looking to refinance my home or maybe not, I am able to pay of my house but I am getting some advice to do refinance. My current monthly payment is 900 ish and I am on 50K now what I could pay of in few months. I am new in all this and I am not sure what should I do :(. Price of the house was 170K [I close on the house 7 months ago]
Some people say I should refinance and they try to explain why should I do that but I guess they don know how to explain
Thank you