I want to refinance my house that I have been living in for five years and have no plans to move. I want to pull out cash to finish my basement and pay off credit cards. I have a discharged BK13 one year old. What steps do I need to take? My interest rate is 8% not sure how much my house is worth. Thanks in advance
2006-12-05 12:38:20 · 6 answers · asked by nightstars00 1 in Business & Finance ➔ Renting & Real Estate
If refinancing is not a good idea what would be a good idea to lower my interest and get money to finish my basement? The credit cards I can pay off myself, I really want to finish my basement and if money was left I was going to pay off the credit cards. Thanks in advance
2006-12-05 12:50:32 · update #1
You need to know your credit score, but do not have more than one person pull your credit. A chapter 13 discharged a year ago I have seen some really good scores, depending on what has been reestablished. btw, how many credit cards do you have after a chapter 13 that you need to payoff? After your bk has been discharged for 2 years, you can get a regular, conventional loan (assuming everything else is in line) which rates now are around 6.50% You might be better off waiting until next year, but there's no guarantee what the rates will be like then.
You can look into a home equity loan ~ try your bank or credit union first as they will be the best programs for you. ( a home equity loan is a second mortgage and won't effect your 8% that you have on the current mortgage).
Also, talk to a few lenders about your situation and show them your credit report. We can't answer your question here adequately because there is not enough information. Every person's situation is completely unique.
Good Luck
2006-12-05 12:59:41 · answer #1 · answered by bathagent 2 · 0⤊ 0⤋
Don't. You would be making several mistakes.
1) With the bankruptcy, you won't get a better rate than you have now. (Even though you don't have a great rate now.) Your rate is very important in the long term. Refinance later, in about 9 years, when you have good credit.
2) NEVER trade unsecured debt for secured! You wold be risking your house by trading unsecured credit card debt for debt secured by your house. If you don't pay your CC bill, what's the worst that can happen? You've already been through it. If you can't pay your mortgage though, you get evicted and lose the house. You don't want that. That's why using home equity to pay off CCs is a bad idea.
2006-12-05 20:44:23 · answer #2 · answered by Lisa A 7 · 0⤊ 0⤋
Simply contact a loan officer. I would recommend Wells Fargo. I have dealt with them for years and have never been disappointed. There are many programs out there. My advice is begin building your credit immediately. Do not pay for everything in cash and wait 7 - 10 years. Start building your credit back immediately. Creditors want to see REESTABLISHED CREDIT. However, once someone gives you that chance, what ever you do MAKE YOUR PAYMENTS ON TIME!!! Also I would not recommend buying a car first. It is the easiest but they usually have high interest rates and once you except those terms it seems like that is all anyone else wants to offer you. Also remember to keep your credit inquires to three (3) per year. Anything more makes your credit (FICO score) go down. Also, check out: lifeafterbankruptcy.com
2006-12-06 01:27:35 · answer #3 · answered by s7lmb 3 · 0⤊ 0⤋
One suggestion would be to ask any reputable mortgage lender. The industry is enormous, and there are good players and bad players. If you already have a mortgage, you are familiar with this already, and you've been through a Chapter 13 filing, so navigating this will feel like a piece of cake in comparison. The lender does nearly all of the relevant paperwork. Many financial institutions offer home equity loans, and you might be well-advised to compare terms of several before deciding on one.
2006-12-05 20:49:06 · answer #4 · answered by echolocated 2 · 0⤊ 0⤋
Find a mortgage broker. As a matter of fact find a couple of them. Some have access to better programs than others. They will generally be able to get you a better deal than you will find online, or from the average bank. Your BK may raise your rate depending on your payment history since filing. get a second opinion to make sure they are acting in your best interests. If you are in California, I can help. ronaldj73@hotmail.com
2006-12-05 20:46:44 · answer #5 · answered by Ron B 3 · 0⤊ 1⤋
You do qualify for a mortgage on year out of a chapter 13 bk.
Matt
http://www.diversifiedlender.com
http://www.homemortgageminnesota.com/
http://www.minnesota-mortgage-rates.net
2006-12-05 22:25:07 · answer #6 · answered by Matt J 3 · 0⤊ 1⤋