I just bought my 1st house middle of last year. I had to get a crummy loan to get in (Neg Amortization). Now I'd like to re-fi in the next 2-6 months. Problem is that my principal went up and the home value has probably dropped at least a little. If I can re-fi, will I end up with another high rate because of this? I'm in Sacramento, CA if it helps. Thanks.
2007-01-04 12:26:07 · 8 answers · asked by jsn77raider 3 in Business & Finance ➔ Renting & Real Estate
Yes! There are people who will finance over 100% of the property value.... you need to get out of that neg-am NOW though in order to avoid your balance going up even more. I am fairly local to you and I don't mind travelling.... give me a call or send me an e-mail to set up an appointment.
2007-01-04 12:40:40 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Stick with what you have. There are programs that let you refi up to 125% of the value, but you pay for it. If you have a neg am loan, you most likely have a huge pre payment penalty, and because you have not owned the property for twelve months you will not be able refy into a good loan anyway. Since rates are not going up, your best bet is to start paying the fully amortized, or the interest only payment on the loan you have. If you put some extra down and wait a year or two you will save thousands upon thousands of dollars. You are just spinning your wheels where you are.
2007-01-04 13:04:34 · answer #2 · answered by Ron B 3 · 0⤊ 0⤋
Are you sure that your home is worth less now? My advice is to not just assume that but get it checked into properly. Talk to a Mortgage Broker or Bank and see what options they can give you. The true value of your home can only be determined by an appraisal. What was the situation with your loan - was it 100% financing or do you have a little 'room' there to play with. Once you explore some options you will have more idea of what is available to you. Try and get back on a fixed rate and DON'T get another neg am loan. If you need to keep the payments low consider an interest only instead but if at all possible try and get on a standard 30 yr fixed rate. I am a Mortgage Broker for all states and my advice is free......I hope this helps you!
2007-01-04 12:50:10 · answer #3 · answered by EmmaHersh 2 · 0⤊ 0⤋
To answer your question, yes some lenders will refinance you over 100% however if you are currently in a neg am loan and you are going to a traditional loan be prepared for your payments to go up! There are some lenders out there currently (Countrywide & WAMU) that are offering neg am loans on indexes such as MTA, LIBOR, CODI, your payment has a lot to do with what these indexes are doing on a monthly basis, as such you have probably seen your mtg payment change monthly. World Savings / Wachovia offers this same type of loan on our own index called the COSI (Cost of Savings) if you look online and compare the different indexes you will find that by far the most favorable and stable index is the COSI. If you need help, please dont hesitate to contact me.
Clinton Shepherd
Wachovia Home Loans / World Savings
2007-01-04 17:10:47 · answer #4 · answered by Clinton S 1 · 0⤊ 0⤋
you should be able Refinance. Your Rate will be Based upon what Mortgage Company you use and what your credit looks like. Check around at Many Different Places Before you Sign any papers. Get a Fixed Rate Loan, Not Variable! There are about a million Sites on the web you can get comparisons from. If you have a good Relationship with your Bank, try them, but still look around!
2007-01-04 12:47:16 · answer #5 · answered by John R 6 · 0⤊ 0⤋
Yes, you'll end up with negative equity, which they'll add the difference on to your new balance. It would be the same if you traded in a car for a new car, and you owed more on the old car than what it was worth. The difference would be added into the cost of the new car, increasing the loan amount, and probably increasing the monthly note. Best of luck to you.
2007-01-04 12:36:32 · answer #6 · answered by cajunrescuemedic 6 · 0⤊ 0⤋
Make sure that your Neg-Am Loan does not have a Prepayment penalty? This can kill the deal if you do not have any closing costs. Talk to a Realtor in your area to get a good comparable. Than you can assess your situation and see what products may suit you better. Buydowns are 10x better than Neg am loans. Good luck.
2007-01-05 05:19:18 · answer #7 · answered by Openthathouse.com 4 · 0⤊ 0⤋
You probably can refi. I'm not sure about the rate since it depends what the principal and interest rate is. I'm curious, how much did you pay for the home? I'm sure it was in the $500,000 and up range?
2007-01-04 12:35:21 · answer #8 · answered by Anonymous · 0⤊ 0⤋