Posted on: 09th Sep, 2009 09:43 am
hello - i would like to refinance my 80/20 loan. at the time (2006), i provided full income documentation with a score exceeding 800 and my broker me told no one was offering fixed rate loans and not rates lower than 7%, although i called a national bank directly when i was getting ready to close - they would have gave me a 30 year fixed no problem for a slightly lower rate, and it could be processed in reasonable time. why i didn't switch? because i was told the borrower would sue me if tried switch - breach of contract - for not closing on time. and of course we closed a week and a half early..by then i could have taken then other loan.
do you think it's possible any lender will consolidate/refinance these two into one fixed rate loan? i've never been late, i am able to continue with my current payments, i'm not really looking to lower payments (it would be nice, of course), and credit is still great...just want to enjoy the help that's out there for everyone else.
do you think it's possible any lender will consolidate/refinance these two into one fixed rate loan? i've never been late, i am able to continue with my current payments, i'm not really looking to lower payments (it would be nice, of course), and credit is still great...just want to enjoy the help that's out there for everyone else.
Unless you have equity int eh house, that is really difficult
Hi Angelika,
Your best bet would be to subordinate your second and try and refinance the first as a rate and term. I would be willing to bet you are underwater on the first and second combined but if you just lower the rate on the first and don't take any cashout you should be able to get your second lien holder to agree to a subordination because lowering your rate on the first lessens the risk of foreclosure. The last thing they want you to do is foreclose because they know that being in second position these days means no money left for them. With fixed rates in the mid to high 4's, it would probably benefit you greatly to refi the first into a fixed. Now, do you have good credit? What's your home worth? How much do you owe on the first?
Jason Vondrak
[Contact details deleted as per forum rules. Thanks.]
Your best bet would be to subordinate your second and try and refinance the first as a rate and term. I would be willing to bet you are underwater on the first and second combined but if you just lower the rate on the first and don't take any cashout you should be able to get your second lien holder to agree to a subordination because lowering your rate on the first lessens the risk of foreclosure. The last thing they want you to do is foreclose because they know that being in second position these days means no money left for them. With fixed rates in the mid to high 4's, it would probably benefit you greatly to refi the first into a fixed. Now, do you have good credit? What's your home worth? How much do you owe on the first?
Jason Vondrak
[Contact details deleted as per forum rules. Thanks.]
Jason I am not sure it will be asy to refinance the first oen when the price of the house is lower than what he/she owe
angelika, you haven't given us any information about the home's value, but as jason did above, i suppose i'd have to think it's safe to say that there's not a lot of equity in the home at this time. fortunately, 3 years have gone by, and you've perhaps paid down your balances reasonably. i hope so.
if your value is equivalent to or less than what you paid originally, you will find it difficult to refinance. if your balances are lower than the current value, there is a possibility that an fha refinance would work, since that allows for less equity than conventional loans.
your credit isn't really much of a selling point in this market, unfortunately. lenders are terrified of declining values, and you could be at 850 and have no equity and be unable to do anything.
jason's suggestion of refinancing the first mortgage and trying to resubordinate the second has some merit. it's dependent on your current home value, as is pretty much everything else.
if your value is equivalent to or less than what you paid originally, you will find it difficult to refinance. if your balances are lower than the current value, there is a possibility that an fha refinance would work, since that allows for less equity than conventional loans.
your credit isn't really much of a selling point in this market, unfortunately. lenders are terrified of declining values, and you could be at 850 and have no equity and be unable to do anything.
jason's suggestion of refinancing the first mortgage and trying to resubordinate the second has some merit. it's dependent on your current home value, as is pretty much everything else.
Thank you all...believe it or not the value in my neighborhood hasn't changed much (according to the recent sales data). But I'm still working on how to get a true appraisal...I still have 3 years to work with...was just highly annoyed with the situation and wondering if it would be a waste of time to try anything now.
3 years? you have a variable rate to boot?
now keep in mind that your "true appraisal" isn't going to hold water with your prospective lender, as any appraisal report must be independently done.
now keep in mind that your "true appraisal" isn't going to hold water with your prospective lender, as any appraisal report must be independently done.
It was a 7/1 arm...I made them give me the longest term possible since they refuse to give me a fixed.
is your first mortgage owned by fannie mae or freddie mac?
if not, probably the only way you could refinance would be if the house value increased from when you purchased.
if yes, there are special refinance programs up to 105% and even 125% of the value and sometimes an appraisal is not even needed. you will have to subordinate the second mortgage because these programs do not allow for combining the first and second mortgage. you will be stuck with the second mortgage holder as to whether they agree to subordinate or not.
call the 800 customer service number of your existing lender and ask if your 7/1arm is a fannie mae or freddie mac loan.
if not, probably the only way you could refinance would be if the house value increased from when you purchased.
if yes, there are special refinance programs up to 105% and even 125% of the value and sometimes an appraisal is not even needed. you will have to subordinate the second mortgage because these programs do not allow for combining the first and second mortgage. you will be stuck with the second mortgage holder as to whether they agree to subordinate or not.
call the 800 customer service number of your existing lender and ask if your 7/1arm is a fannie mae or freddie mac loan.
