03-23-2009 12:55 PM - edited 03-23-2009 01:00 PM
What is the right way to go about the refinancing process now? We want to roll our second mortgage into our first for a conventional loan. Is this an issue? My understanding is since the second loan wasn't used to finance our home purchase but to pay off our debt (lesson learned, never again) this will be considered a cash out refinance even though we won't be taking any money out. I swear I've read recently these aren't even really be done anymore.
Our credit scores are decent (a mid score of 738 for me and 742 for my husband), our DTI looks okay but our home value is somewhat unknown due to lack of recent home sales in our neighborhood. Our most recent tax assessment has the home valued at 507K. I suspect we would get more than that for it but I really don't know for sure. The total loan value for our current two mortgages is 391K.
I keep reading about higher application volume, tighter standards locking people out, and more bottlenecks in the process. I think I have into the latter already. I called our LO Thursday to see where rates are and if a refi might be possible. He said he would work up a GFE but I haven't heard back from him. Is this normal? He hasn't pulled our credit report (as far as I know) but he did mention something about looking at taxes. I wasn't sure if he meant our income taxes or our tax assessment.
any help and insight is greatly appreciated. Thanks.