Lending a Hand, Peter Boutell: Refinance upside down mortgage while rates are down Santa Cruz Sentinel
Just when we thought mortgage rates could not go down anymore, they have hit record low levels again this week, and every homeowner should take another look at their current situation.
Homeowners refinance for many different reasons. Some want to lower their payments. Some want to shorten the life of their mortgage. Some want to get out of an adjustable rate mortgage. Some want to pay off a HELOC Home Equity Line of Credit and some want to see how much cash they can create without raising the payments.
While it is true that many of the new guidelines issued by the mortgage industry in the past few years have restricted homeowners' access to mortgage money, there are still some very good programs to help homeowners.
One of those allows homeowners who owe more money than their homes are worth to refinance into a lower rate. Freddie Mac and Fannie Mae have issued a guideline that allows a homeowner to replace their current loan even if they owe up to 125 percent of the appraised value of their home it estimated that more than 25 percent of homeowners in the U.S. owe more than their home is worth.
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Cash Out vs Rate and Term Refinance Mortgages (Episode 82)
Let's talk about the difference between a "rate and term" refinance and a "cash out" refinance using a conventional mortgage.
where can I find the current rate for cash out FHA refinance?
We live in Suffolk County, NY. We have excellent credit and no debt. I want to double check that the broker is getting us the best rate.
Wow, I didn't even realize they were doing FHA cash out refinances these days.
Conventional rates are easy to check at Bankrate.com. Don't know about FHA.
how long do i have to wait after getting a mortgage to refinance for a better rate and cash back.?
Wait until your mortgage is up or you will pay 3 months interest at the time of renegotiation. The next thing you know your mortgage will be bigger than the value of your house!
i work with a very old company and we have almost 120 different lenders
that way its easy to offer you to shop around then you know
exactly what you qualify to contact me
mario_globalwide@yahoo.com
Refinanced mortgage, if cash is taken out is the rate different?
Eg. I want to refinance a 155K mortgage and 30K equity line into 185K fixed mortgage. If I take out 50K cash too, is the APR on the 50K cash the same as the 185 fixed mortgage?
Yes, a cash out transaction has a higher cost than a rate & term, or purchase.
Also: If that 30k equity line was taken out after the purchase and thus was not used to originally acquire the property, combining those loans into one new one is a cash out transaction even without the extra 50k.
in any event, your rate will be higher because of the cash out unless you at 70% LTV or less
LTV = $185,000/your value
Make sure to price out your loan with your LOCAL banks and mortgage brokers only.
A lot people giving advice on here are also looking to give you a loan (its not advice, its advertising), if they are not local to you and you can’t get to them within 1 hour don’t fall for it. They say they are licensed in all 50 states, what does that mean? Which state do you have to look in first if something goes wrong? KEEP IT LOCAL; DON'T GET RIPPED-OFF BY SOMEONE IN WHO KNOWS WHERE WHICH YOU WOULD HAVE NO DIRECT ACCESS TO.
Remember Buddha's advice:
"Believe nothing, no matter where you read it or who has said it, not even if I have said it, unless it agrees with your own reason and your own common sense." You are the only "expert" you can trust: All brokers, and every other loan officer guru giving advice here with a .com or contact me at the end is "selling" you something (its not advice, its advertising). Don't buy "it."
Can you still refinance with cash out if your home has been off the market more then 3 months. ?
I have a balloon payment coming up in Sept 09 and would like to refinance with cash out. The bank told me cash out at 80% of LTV and at least 3 months off the market. Now they are changing there tune. They said that since the house has not been off the market for more then 6 months they have to drop my LTV to 70% are they legally aloud to change there tune after I have payed my lock in rate fees and signed paper work.
If you read your agreement, you will undoubtedly see that they have included language along the lines of "the bank has the right to change these (the refinance rules) conditions from time to time with proper notice."
In effect, what you signed gave you the right to refinance under certain conditions, but those conditions can change somewhat.
If you applied with a big bank you are stuck with their guide lines and they can change them at anytime. What usually happens when you have your loan locked and the guide lines change is you are given a specific time frame that you must close and fund the loan under the old guide lines but that is up to the individual lenders.
With the emergency rate cuts by the Fed yesterday, should I refinance my mortgage? I have a 30 year at 6.125%
I bought in Oct 2006 with 20% down for a $250K house. Got a 30 year mortgage at 6.125%. With the emergency fed rate cut yesterday, is now a good time to refinance or do you think it will go down more? How much cash do you need to refinance? Thanks!
you should have little to no costs to refinance you should be able to roll the fees into the loan but look for someon that will do the loan with minimal fees and still get you the best rate
I would look to see how much you could save doing a refinance your rate would fall about 3/4% or more of a aprox. your fees could be very low because its a refinance.see if theis calculator will help. assuming you have 680+ credit you could get a gret rate. the fees will be the determining factor here i think. if you can cut 3/4 a percent or more and are not going to refinance within the next 3 years id say yes it may be a good time! I dont think we are going to see any more huge cuts. so jumping on this opertunity may be a good idea. see what the calculator says you would save and contact someone to see if they agree! i would not let a lender pull your credit you should have agood idea what your score is and just tell them!
asuming you can get a rate of 5.30 or better you sould save about $36,900.00 over the lofe of your loan and should cut your payment about 160.00 monthly
if you applied the extra 160 to the new mortgage it would save youa an additional 69,649.00 in interest and you would pay off the mortgage 6 yrs and 2 months early!
total interest saved $106,549.00
You may find it favorable to refinance if you can get a loan for 5.5 percent or less with no points. Although yo have paid off about $3,000 in principal, by the time you calculate the refinancing cost you will still end up with about a $200,000 new loan and at 5.5% your monthly payments would be about $80 lower. It seems you would have to go to at least 5% to have a meaningful reduction in payments of about $140.
My other question would be, since you bought in OCT of '06, what's actually left of the 20% you put down? That's meant to say: How much has your home depreciated, if it has.
So, suffice it to say, you can throw all kinds of numbers around, but if you're truly interested, give someone a call, and make sure your fees aren't killing the reason you wanted to refinance in the first place!
Have a great day, and good luck!
how many people on here need to refinance there homes for a lower monthly paymnt, cash out or to pay off bills
refinance. cash out, lower payments, lower interest rates
oh screw off.
If you can't afford to pay for an ad why would anyone want to deal with you?
Can we refinance a car loan with another bank to get a better rate and save money?
We have a car loan for $10,000 and a rate of 7.5%. We were looking for a better rate (to save some cash). Would it be possible for us to find a loan with another bank for a lower rate and pay our current bank off, in order to save money?
Yes, that is called refinancing your auto loan and depending on your financial situation you could save a good amount of money. Check out link brokers like rategenius.com and umbrellaauto.com to get your application shopped around to various lenders. But also go see your local credit unions. They have the best rates, you just have to be able to join.
Doing those things should save you some time and hits on your credit. Refinancing can also allow you to skip a payment or two depending on the lender. It takes time between paperwork and payoff of your last loan. This could really come in handy during the holidays!
But be sure to check out any deal that you are given and be 100% comfortable with it. You shouldn't have to pay an application fee, only title transfer fees if you go ahead with the refinance, and those are assessed by your state, not the company that refinances you.
If you have any more questions about this process, please feel free to ask.
Try throwing 1,000 into the loan, that way you'll pay less interest for the life of the loan.
Is this rate term refi/cash refi?
I have a first and HELOC. The HELOC was a cash-out refinance last year. Now I want to refinance the first (only) without any cash-out. Is this considered a cash-out refinance too or is this a rate-term refi?
thanks.
Your first mortgage is the purchase money mortgage, right? You didn't get any additional cash and haven't refinanced it since you bought the house. If that's correct...purchase money, never refinance, it's just a plain old straight refi. You're not getting any cash, you're not refinancing a cash out loan, so it's just a refi.
Yeah, rate and term, or maybe even just rate and have a 30 year term again...that's probably what the "official" name is, but we call that a straight refi where I work.
Can I refinance with a big cash out if I'm in between jobs?
My home is valued at 365K. I have 88K of the original loan left on the house. I'd like to refinance the balance and take a cash out in the amount of 190K on top of it. I have excellent credit but I'm currently in between my old job (been there 5 years, resigned last week) and a new job (starting in a week). Our (wife and I) annual income is 126K. My questions are: Can I do this while in between jobs? Will I have trouble getting approved for a new 30 year loan at a good rate? Will they care about what I do with the extra money or ask why I need it? (Repaying a personal debt to family member).
If you have an agreement that you are hired by the new company and it is doing the same line of work, then you will not have a problem. By the time the refinance is ready to close, especially if you are only one week away from starting the new job, you will be working and hopefully you may have even received your first pay check by then as well.
1. Yes you can do this in between jobs for the reasons and explanation mentioned above. You will need to document you have been hired by a new company and possibly that it is in the same line of work.
2. As long as you keep your LTV below 80% you will be able to get a good rate. If you keep your LTV at or below 70% then you will be able to get a slightly better rate. For an LTVat 70%, you would need to cut your cash out by about $22,500.
3. The lender will ask what you plan to do with the extra money. Simply tell them it is for personal reasons.
Best of luck.
Some people talk about pulling $$$ out of a home after it increases in value with a refinance.How does it work
Ok Guys, Im new to this whole home buying thing, but I just have a question because I hear about it all the time. When someone refinance a house after a few years, they get a lower rate and they have amassed a good amount of equity both from paying the mortgage and from increases in home value. If they refinance, how do they pull out cash from the refinance and still maintain the same payment, sometimes lower?
Lets take this scenario: $620000 home. $400000 mortgage for 30 years @ 6.5%. After ten years the home increases to $1000000 and balance on mortgage is $340000. Lets say after the refinance the rate is 5%. I know the new payment for another 30 years would be $1825/mo but "how and what would they be able to pull out"?
Can anyone explain (in lamens terms)? thanks so much!
Well. There are a few questions that I think you are trying to figure out here. 1-what a refinance is and what they talk about when they mention the word refinance 2-what will you be able and how to pull out of the re-fi.
*A refinance is essentially a re-structuring or if you wish, taking on a brand new mortgage arrangement different from your present one. Typically, people refinance for getting MORE money out of their house through the HIGHER mortgage due to increase in the value of their property. In you case, you are at ~66% loan to value of your house (forgive decimals...), that is you ALREADY have 100-66%=34% of equity in your house. With your house price going up to 1Mill and the mortgage balance being at 340,000, your equity increases to 66%, i.e. reverse of what you have now except that you now "OWN MORE" of your house than before. Here we are logically arriving at answering question number 2, i.e.
**Should you property increase in value to 1 Mill and your mrtg balance being at 340K, you can go back up to the Loan to Value that you currently have, that is to 34% of equity in the house. So, doing simple arithmetic: A/34%*1Mill=340,000. B/1 Mill-340,000=660,000. This is the amount you can refinance to and "pull out" 660,000-340,000(mrtg balance then)=320,000. Your 320,000 will be your new money you could potentially invest into another property. The only caveat that you should be carefuly here is the potentially (!) lower rate on a re-fi. Yes, if rates go down in the market and you are able to fetch an awesome broker's deal, then possibly you might end up with 5%. Again, typically, on an INcrease to your mortgage balance (remember: you were at 340K and now at 660K), the rate may be blended between what you have NOW and what the new rate on a new mrtg term and balance gonna be. It is highly probable your rate will be either:
A/ lower than 6.5% now IF rates go down and you are able to find a better deal at the lower rate then
B/blended HIGHER if the new rate on the new funds to be added is generally higher due to market conditions
C/ blended LOWER if the new rate on the new funds to be added is generally lower due to market conditions
Anyhow, you need to do some shopping and what I call "thorough explanation meetings" with those people you are going to talk to regarding your new 660K mortgage then. Who knows, eh?
You pull the money out on the new 660K mortgage by simply getting a new type of a mortgage when the old one will be paid off (with a balance of 340K) and the DIFFERENCE will be simply deposited (by the new lender providing the new 660K mortgage) to your bank account.
Uff, I even got tired typing all of this fo ryou...Hope that helps...:-)