Can I combine two loans into one even though my house has not appreciated it very much?

Question

I want to combine my two loans into one for 30 years fixed rate. my 1st loan is a fixed 30 years , but my second is a baloon for 15 years. i have no penalty. do i have to wait. thanks

i have been here for about 6 months.

Answer 1

You may be able to do this. It all depends on how much equity you have in the house. It may force you into paying PMI if your equity is less than 20%. It sounds like your loans are fairly new and I doubt that there has been much (if any) appreciation in value. You can talk to your lender but with the little that you have given it doesn't look good.pp

Answer 2

It depends on many factors, but keep in mind that if you got your loan over the past few years, you will probably get a higher interest rate. You need to look at the effective interest rate on all the money borrowers.

For example, if the first loan is $80k at 5% and the second is $20, at 10%, then you are paying $4k in interest on the first loan each year and $2k on the second, for a total of $6k total. This is an effective interest rate of 6% on all the money combined. Plus, keep in mind, it costs money to refi. And by combining the two loans, you will probably trigger PMI. Avoiding it was the reason you did the two different loans in the first place, I'd guess.

If you can meet the payments, keep the two loans and pay down the second as fast as possible.

Answer 3

You can do that, but how long have you been in your house?

I would combine them both into a FIXED RATE loan for FIFTEEN years, not 30. If you do it for 30, you are lengthening your loan. Don't you want to pay it off sometime?


Make sure to consider the fees involved in a new loan.

Answer 4

I seriously doubt there are no penalties on either loan if you refinance within 2 years. Even people will goldne credit have to wait a time period.

You can combine by refinancing your home for enough to pay off both of the loans.