Refinance When You Have A 2nd Mortgagerefinance. Highlights. Before you refinance, the home equity lender has to resubordinate. Another option is to pay off the home equity loan or line of credit. Rolling both loans into a refinanced loan can be difficult and expensive. Having a home equity loan or home equity line of credit when you're trying to refinance your mortgage adds another layer of complication to the approval process. That's because the second mortgage holder, which is legally entitled to move into first place when the first mortgage is refinanced, has to agree to give up that spot to the refi lender. If you can't strike such a deal, called a resubordination, you'll have three options. Pay off the second mortgage. Consolidate both loans with the second mortgage lender. Forget about the refi altogether. Most refinancers prefer to go the resubordination route, even though it takes time and often involves fees. And the resubordination rules differ for loans under the Home Affordable Refinance Program, or HARP. Resubordination costs time and money. Before it can refinance your primary mortgage, a lender must submit a subordination package - - all of the documents supporting the request - - to the institution holding your home equity loan or line of credit. The second mortgage lender typically charges a fee of $7. Anne Benjamin, chief operating officer at Redwood Credit Union in Santa Rosa, Calif. Homeowners who have a second mortgage can still refinance with HARP With Second Mortgage as long as the second mortgage lender will subordinate it. The Home Affordable Refinance Program allows homeowners who owe more than 80% of the value of their home to refinance into today's lower rates even if they have a 1st and a 2nd mortgage. Your Arizona HARP Mortgage Lender is here to help again with HARP! The new HARP 2 is set up to provide relief to homeowners that are upside down. One of the requirements of the program is that a borrower. Mortgage boulder 2nd mortgage charlotte north carolina maryland refinance mortgage rate. Harp home affordable refinance program You can use a loan to cash-out for things like home improvements or a well deserved vacation. The response can take up to six weeks, Benjamin says. Unless there are questions regarding the value of the home, Redwood's resubordination requests to second lien holders are seldom denied, Benjamin says. And when there are such issues, the credit union is unlikely to send the prospective refinancer's request to begin with. The program was revised recently to increase the number of borrowers who can participate. Among the changes is an item that seeks to remove the resubordination hurdle for many applicants with second mortgages. As before, HARP is available only to homeowners whose mortgages are held or guaranteed by Fannie Mae or Freddie Mac. Wells Fargo already approves most resubordination packages it receives from first- edition HARP loan applicants, Brown says. Benjamin says Redwood Credit Union will consult with members about the feasibility of doing so. She adds that you should compare the monthly payments and total interest over the life of the new single loan versus what you have now. Valerie Cardenas, senior vice president of mortgage lending at International Bank of Commerce in Mc. Allen, Texas, says borrowers often benefit from consolidating because the rates on home equity loans are typically higher than current primary mortgage rates. But if your second loan has a fairly low balance, it might not be worth the cost of combining the loans. Doing nothing is the easiest course of action, even if it's not always the cheapest. Ask Kate about your HARP loan program and 2nd mortgage refinancing problems: Meet three homeowners who are trying to refinance second mortgages. The Home Affordable Refinance Program, also known as HARP, can help you lower your payments or change to a more stable loan type. A HARP loan is a simplified refinance loan for existing Chase mortgage customers.
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