Hi, I'm trying to hang in there until my penalty is over to refinance in Feb.2008. My question is that with the market being down, wonder if I can refinance for lower rate? My 1st is 598,000 with 10% rate and 2nd $21,000. I just wanted to refinance my 1st. Trying to hang on paying $5292 a month. The problem is that market is down and checking online my house is worth $620,000. Will it even go down in the near future when I can refinance and will that be a problem? Also my credit has gone down because of 1 late mortgage payment, from 650 to 583-610(3 credit score). Also another problem is that my husband is self employed in Oct.2006.
What is my chances to refinance for lower rate in Feb.2008?
2007-08-28 07:39:27 · 5 answers · asked by kaytreya 2 in Business & Finance ➔ Renting & Real Estate
Sorry to say home worth, or prices are going to continue to drop with more on the market, or in foreclosure, and less eligible people to buy because of the tightening of credit. From a previous post of yours your credit is not too good so I would basically say refinancing is not an option that will be available to you, especially at a lower rate. Honest believe that unless you can hang on with the interest rate hike that is coming, you will join the statistics of those in foreclosure. Best of luck to you hope you can weather the storm
2007-08-28 10:47:25 · answer #1 · answered by Pengy 7 · 1⤊ 0⤋
What refi? With the late on your mortgage payment, you will not qualify under today's tighter lending standards. The few loan programs for which you will qualify have higher interest rates than you are probably presently carrying.
To use self-employement income, you need a two year history of receipt, and proof that the income is steady, stable, and likely to continue. If the applicant has a strong credit history, that can be shortened to one year. But the full year needs to show on a tax return. The earliest you can use his income to qualify for a mortgage would be April 2009. But in your circumstance, that will probably be April 2010.
Your best bet is to pare down your expenses, get an additional job and/or earn more money or rent a room in your home.
2007-08-28 14:51:13 · answer #2 · answered by CJKatl 4 · 0⤊ 0⤋
You have several challenges here. The drop in value of your home means that you would have to come to closing with cash in order to clear title. You cannot simply refinance the first mortgage without dealing with the 2nd somehow. Mortgages attach to property according to their age. If you payoff the first mortgage the second becomes the first. It might be possible to do what is called subordinate the second so that you could refi the first but being upside down in value versus debt on the home may preclude your ability to get that done.
Next issue: your credit score decline is going to make it really challenging at this high a combined loan to value. Most lenders have dropped maximum loan to value to 95% now in reaction to the market's instability.
Finally, investors require that in order to determine income for the self employed they must be given 2 years income taxes from which they may average an income.
Also, that late mortgage payment is a killer. Not only does it affect your credit score, it means that you are not going to be eligible for best rate loan terms if you are able to refi at all.
Sorry to be the bearer of bad tidings but you appear to be the poster child for what happens when people bite off more than they can chew mortgage wise.
2007-08-28 14:50:20 · answer #3 · answered by mazziatplay 5 · 1⤊ 0⤋
If you plan to pay back the money , you can ask for a loan at Prosper. More information at http://www.acreditlibrary.com/prosper.html . You can also try your luck at online charities, people may send donations. More information at http://www.laodn.org/
2007-08-29 09:30:59 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Unfortunately, it does not look good. Sorry!
2007-08-28 14:44:23 · answer #5 · answered by ? 4 · 0⤊ 0⤋