I currently have about 90,000.00 equity in my house. I have a FHA loan which I'm paying PMI on. I was thinking of refinancing so I can get rid of it (the loan is only a little over a year old). Then I thought, if I'm going to refinance I might as well try to include all of my bills. I have about 30,000.00 in credit card bills. My scores, as far as I know, are mid 600's (who knows what they "really" are). I have a 7 year old BK. My question is, is it possible to reifinance that much debt into a mortgage. I would still be below the 80% LTV to not have to pay mortgage insurance. I treid the debt consolidation refi calculator on Countrywide but for some reason it would not go all the way up to 80% LTV and only ended up giving me 10,000 for debt consolidation. Will they look past my low scores knowing that it's mainly my high debt ratio doing it to me? I have no late payments or anything else bad (besides my bk). I'm scared to start applying and racking up inquiries if it's going to be a big fat rejection.
When I refinanced about a year ago with Countrywide, we were told as long as we were above 620 not to worry. It may be different in your area, but we were sent several letters over several months about calling them to refinance. But that was during the big push by mortgage brokers/bankers. Have you called them? Michelle PS: I am not a mortgage broker!
Yes! Hello, I'm a mortgage banker in CA. I'd be happy to assist you. Get out of that PMI and pay off those debts! Please email me at spalmerhomes@aol.com and we can chat further. Sheila Palmer Eagle 2000 Mortgage Services 1-800-69EAGLE
First, you don't have to refinance to get rid of PMI. All you need is an appraisal, maybe $300 at most out of your pocket. Second, you'd be amazed at the deals out there right now. Try to get a fixed, rates aren't getting lower and they're only going to be higher.
I think FHA can keep PMI on even with an appraisal, but I don't remember exactly what they told me. I refinanced my FHA to a conventional to get rid of the PMI, and I seem to recall that under FHA rules they wouldn't release the PMI even with the proof. FHA is kind of screwy sometimes.
I happened to get an add in the mail today & called them. They claim they can help me but we'll see. Sheila: If they are unable to help me I will certainly contact you. I'm sorry I didn't check back here first. I was told that it has to be a minimum of 5 years before you can get rid of PMI on FHA. I was also told that some lenders will get rid of it before that if you pay for a new appraisal. My lender said they don't do that and are not aware of any that do. They also said that 5 years rule is no guarantee either. Doesn't look promising.
(i dont have my fha book with me) but MIP (fha's version of PMI) is either for the life of the loan or seven years. don't remember exactly. the only bad side about refinancing to pay off debt is if you don't make the payment - they take your house, rather than charging off a debt. and most lenders will make you close those accounts once they are paid off. you would be better off talking to your creditors about lowering your rate and making larger than required payments.
It depends on how much debt and why. I refinanced my house about 8 or 9 years ago to pay off debts I got stuck with in a divorce. I couldn't have negotiated anything with the creditors then--I was delinquent on a lot of accounts. They sent the checks to the creditors, but did NOT require me to close the accounts. In fact, some of them are still open and are now good accounts. But jenz has a good point. Make sure you're going to be able to handle the mortgage, and don't run up the cards again, or you'll be in even worse shape. If you're not in a delinquent status, and can handle what you have now, you might want to just negotiate rates if you can. If you pay off your debts with the mortgage, you're paying for it for 30 years. Of course, the interest is deductible. If you're doing it for convenience, then take the amount of money you would be paying on the bills and invest it every month. That way you're saving, at the end of the 30 years you'll have money as well as a paid off house.
Maer- 620 is the cutoff. You can get the cash - maybe even 125% HELOC. I am in California too - you are in good shape. I would definately search for securitypacific.com for a start - AND in google, type in home loan or 125% heloc. LOTS of places will refi you!!!! Good luck - dogman
Hello Again Maer, You want to get out of that PMI, thus you don't want a HELOC (home equity line of credit). You are less than 80%, so you wouldn't need a 125%. You will have NO problem getting refied. Please remember not to give your social until you are ready to go with a broker. You know what "range you are in. However, the mortgage credit report can vary from the ones you are pulling on yourself. I'd be happy to assist you and let you know if they are giving you the best deal. You have a lot of options. I work with over 100 investors/lenders and would be happy to be of service should you need me. BTW...620 is not the minimum score to refi or purchase. I can do loans down to 475 scores. Take care, Sheila Palmer CA RE/Loan Broker
lol... 475.... what are they putting down? 30%.... did you keep their "arm and leg" when you made your 4 points? lol
couple things... not all mortgages are tax deductable - in some states if you use a mortgage to pay off debt, it isn't tax deductable, so check with a tax preparer. some states have predatory lending laws - meaning if the monthly payment of the debt isn't less than what you would pay otherwise, it is against the law. there are things called HOEPA (homeowner equity protection act) to protect you from outrageous interest rates (there are caps). if your looking for convenience, have your payments auto debited. if you are looking to save money, negotiate interest rates. if you default on the loan they take your house. if you default on your credit card, they report it to your credit report. big difference i do 2nd mortgages up to 100% cltv and score only determines the rate, not if the loan makes sense.
HA! I don't work that way! And yes, it's a 70% loan (no arms and no legs and no 4 points). You'd be surprised how many people need a loan with a 475. 100% are available with a 560. This is not rocket science...it's a refi. This loan would be tax deductable if she has not taken cash out in the last year. Just trying to be of help.
What is the value of the home? 90,000 is alot of equity. i might even let you borrow some of my own proceeds with that kind of equity. bottom line is that i see no problems for you in terms of finding fair refinance terms. Depending what market you live in and your income, you may qualify for community development funds.
Why does everyone assume that we are all sharks? I AM NOT!!! There are "FAIR" lenders out there. She's not a freakin charity case...just someone that is scared because of her credit history. She is more than fine with a mid score of 600, she would be if she had a mid of 500. Maer will get a better rate, get rid of her yucky PMI, pay off her debt, have more to write off and probably pay less than she is paying now. I don't know why everyone is so skeptical.
Frirstclass, Depends on overall score, equity, income, etc. There are lenders that will only rate you on your mortgage history, not consumer debt. Were your lates on your mortgage, credit cards or car (or other installment)? Email me with any specific questions at spalmerhomes@aol.com. I'd be happy to help. You'd be surprised what we can do!!! And rates are awesome for prime and subprime (lower credit scores)!!! Take care, Sheila CA RE/Loan Broker
