Posted on: 19th Jul, 2010 08:55 am
we are current on our mortgage, but are paying 7.89% interest. we would like to refinance, but our home is underwater as a result of the downturn in the housing market and the current problems with the economy. i have asked my lender about modifying to a lower interest rate without reducing the balance of the mortgage, but they haven't really been open to the idea unless we can show a hardship. i can show a hardship, if necessary, but i don't really know that i want to go there since i'm not asking them to reduce what we owe as far as the mortgage goes, just to reduce my interest rate, which would lower our payment (i'm also willing to refi for 25 years instead of stretching it back out to 30 years).
we would like to refinance at a lower rate as obviously we can afford a lower mortgage payment (since we are current on our now almost $2,000 a month mortgage), but no bank will refinance our mortgage because our home is underwater.
do we have any options? i really don't want to miss a payment just to try to qualify for a modification.
we would like to refinance at a lower rate as obviously we can afford a lower mortgage payment (since we are current on our now almost $2,000 a month mortgage), but no bank will refinance our mortgage because our home is underwater.
do we have any options? i really don't want to miss a payment just to try to qualify for a modification.
You can get a lower interest rate if you can refinance without an appraisal. If you have an FHA mortgage, you can do what's called "Streamline Refinance" that simply lowers your interest rate without requiring your home to be worth more than what you owe on it.
My research indicates that as of 11/09, a Streamline Refi requires an appraisal and that it will only refi 97.75% of the mortgage.
If you don't have an FHA loan, use this site http://makinghomeaffordable.gov/borrower-faqs.html to find out if your mortgage is owned by Fannie Mae or Freddie Mac. If it is, then you can refinance up to 125% of your home's value. That means you can still refinance even if your home is underwater.
Streamline refinances on FHA mortgages can still be done with no appraisal. I've done them in the past two months in PA and VA. The following update to the streamline process was made jan. 1 of this year:
"The maximum insurable mortgage cannot exceed: The outstanding principal balance minus the applicable refund of the Upfront Mortgage Insurance Premium, PLUS The new UFMIP that will be charged on the refinance."
That includes refinances done without an appraisal.[/list]
"The maximum insurable mortgage cannot exceed: The outstanding principal balance minus the applicable refund of the Upfront Mortgage Insurance Premium, PLUS The new UFMIP that will be charged on the refinance."
That includes refinances done without an appraisal.[/list]
I've had my mortgage for 13 months and my interest rate is 5 1/4% - is it too soon for me to refinance to a lower percentage?
Diane - That depends on the type of mortgage you have.
If you have an FHA mortgage, you can do a streamline refinance after 12 mos, if you have:
1) not been 30 days more than once in the past 12 mos, and
2) made all mortgage payments on time for the three months prior to applying.
For Freddie Mac and Fannie Mae there's no requirement that you have the mortgage for X number of mos before a refinance, BUT the lender you use for your refinance might.
If you have an FHA mortgage, you can do a streamline refinance after 12 mos, if you have:
1) not been 30 days more than once in the past 12 mos, and
2) made all mortgage payments on time for the three months prior to applying.
For Freddie Mac and Fannie Mae there's no requirement that you have the mortgage for X number of mos before a refinance, BUT the lender you use for your refinance might.
Diane,
Can I suggest that you contact Mark foreman at ubiquitous mortgages.
This guy really knows his onions regarding refinance. The website is www.ubiquitous-mortgages.com. I have been daling with them since 2008 when they were called lowratespanishmortgages.
They have arranged multi currency ,ortgages for several of my family members
Good luck
Peter
Can I suggest that you contact Mark foreman at ubiquitous mortgages.
This guy really knows his onions regarding refinance. The website is www.ubiquitous-mortgages.com. I have been daling with them since 2008 when they were called lowratespanishmortgages.
They have arranged multi currency ,ortgages for several of my family members
Good luck
Peter