Need HELP with Refinance Question. High Card Utilization hurting FICO

Discussion in 'Credit Talk' started by mystian, Jun 16, 2017.

  1. mystian

    mystian Active Member

    So last year I had my credit score up to 690 and was on the right track. I have an FHA loan on my house and pay $549 a month in PMI. So I planned to refinance as I have approximately $250,000 in equity and wanted to lose the PMI. My all in mortgage with interest, tax, and PMI is $3,500.

    I bought the house in 2013, renovated one bathroom, updated all appliances, and all landscaping adding also a 12'x10' shed. House was prepped for new appraisal, but I had leaned heavily on credit cards to make the improvements thinking I would just refinance and maybe get an equity line to consolidate the card debt. My house is worth roughly $725M and my mortgage is down to $480M.

    Then all hell broke loose. My Fiance was caught cheating with my friend and I spent the last year in complete chaos with no time to worry about refinancing. I own the house and he is out. But now, my credit card debt is $25M and I've had the burden of an additional year of PMI. I wanted to repay all card debt and lower my mortgage payment to remove PMI. But now my PMI should automatically drop off in May 2018. If I can make it that long.... my rate is currently low at 3.25%.

    I'm stretched and unsure what to do, refinance to a hire rate now, take a high interest personal loan? I don't think I can qualify for equity loan....I have equity but my score is now down to about 620 pretty much all based on high card use. The expense of paying monthly on $25M worth of credit cards, my mortgage, and PMI is leaving me very cash poor. I net about $5M per month. The mortgage was always in my name only, but my fiancé was at least some additional income. Sayonara to that.

  2. mystian

    mystian Active Member

    I cant edit, but I meant "higher rate". What kind of lender would make an equity loan or refinance my mortgage. I am afraid of some fraud. My 3.25% is 30 year fixed rate.
  3. jshimmer

    jshimmer Well-Known Member

    If your home is worth $725,000 and your mortgage balance is $480,000, you have nearly 34% equity in your home. Your PMI should have come off long ago (20% equity).

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