refi question

[Anonymous]

Hello,

Need some advice - my FICO is 655 (EQ) and I'm looking to refi with the current lender as the ARM is about to expire next year .. i was close to 800 when I initially financed however just ignored some credit card payments that went into collections that really pulled my score down .. never had late mortgage payment (except once 2 yrs back which was a transaction issue with direct withdrawal) .. i'm trying to improve the score by GW/PFD however if I can refi now, I would do that .. Question is at this score, will I be able to refi at the published rates or am I looking for something much higher? I have been working for the same company for over 10 yrs, income is more than $100k, no other debt besides mortgage and have been in the same mortgage for 4+ yrs, taxes + insurance is about 7k on the house .. any advice will be appreciated.

Thank!

[Anonymous]

forgot to mention that the refi amount is appro $280k

[Lel]

What do you think is the fair market value of your home, based on recent comparable sales in your neighborhood?

How recent were those skipped payments and referrals to collections?

When you referred to published rates, are you talking about the best rates that appear in bank ads, for example?  If so, then at 655 you probably won't qualify for these rates if you go conventional.  If you go with an FHA loan, you'd get the current FHA rate, but you may have to pay a mortgage insurance premium depending on your LTV and length of your loan.

[DallasLoanGuy]

what is the fha loan limit where you are?

[Anonymous]

the fair market value is ~300k (per the tax assessment) ... the last skiped payment was 6 months old (120+ aging) and there are collections currently active that i am trying to resolve and will get my score higher hopefully once settled.

the FHA limit is $315k

what score do I need to have to get the lowest published rate from the current mortgate company (PENFED)? above 720 or higher? 

[Anonymous]

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@Anonymous wrote:

 the last skiped payment was 6 months old (120+ aging) and there are collections currently active that i am trying to resolve and will get my score higher hopefully once settled.

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Be sure to arrange to have them delete the collections from your reports prior to handing over any money.  Paying or settling alone won't help your scores.  Good luck!

[Lel]

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ab wrote:

the fair market value is ~300k (per the tax assessment) ... the last skiped payment was 6 months old (120+ aging) and there are collections currently active that i am trying to resolve and will get my score higher hopefully once settled.

the FHA limit is $315k

what score do I need to have to get the lowest published rate from the current mortgate company (PENFED)? above 720 or higher? 

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The assessed value for tax purposes is not necessarily the fair market value.  In fact, the tax assessor's number can be far off the real value of your home.  You should look at recent comparable sales in your area to get a true sense of your home's worth.  You could also speak with a local real estate agent to see how he/she might price your home.

Assuming that you home's value really is $300,000 and you owe $280,000, you will probably have to bring money to the table to refinance with PenFed, since your LTV ratio is greater than 90%.  Also, with LTVs above 80%, they will require private mortgage insurance, I believe.

[Anonymous]

If you can go with a 15-year FHA loan then you should be able to get 4.75% with this credit score.  I have a middle 657 and BOA gave me a 15-year at 4.75%.  You will not have any monthly insurance premiums but you will more than likely be hit with the upfront premium of 1.75% that is added to the loan balance.  If I were you I'd give BOA a call and see what they suggest.

Good luck!!