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Options for under water borrowers

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Regular Contributor

Options for under water borrowers

Hi I'm trying to refi my home. In a 8% conventional loan. Great credit scores. The home is coming in 21,000 lower than what's needed to refi. I need to know my options. The loan isn't owed by fannie Mae or Freddie Mac. What are my options for refinancing without destroying my credit score. I can afford the payment, but I'm throwing away lots of money.
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New Member

Re: Options for under water borrowers

Hi - no solutions here, but looking for answers, too! :-)   I have a 9+% loan on a property that is now State appraised  20K lower than what is owed on in.  Comps in this area are about what we owe. Haven't tried a re-fi as debt ratio is out of wack, but getting a re-fi would help the debt ratio (be able to pay down the CCards.).

 

Ideas from anyone would be wonderful...


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Frequent Contributor

Re: Options for under water borrowers


@tiff wrote:
Hi I'm trying to refi my home. In a 8% conventional loan. Great credit scores. The home is coming in 21,000 lower than what's needed to refi. I need to know my options. The loan isn't owed by fannie Mae or Freddie Mac. What are my options for refinancing without destroying my credit score. I can afford the payment, but I'm throwing away lots of money.


Who is the Investor of your mortgage?


Starting Score: 06/2011 505 EX 523 Lender Pulled
Current Score: 08/2011 628 EX 575 Lender Pulled
11/14/2011 TU 584

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***Closed on my home 05/18/2012***


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Super Contributor

Re: Options for under water borrowers

look into HARP 2.0

 

for fannie mae owned properties.

 

Retired Lender
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New Member

Re: Options for under water borrowers

any viable options if mortgage isn't backed by Freddie or Fannie?

 


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Moderator Emeritus

Re: Options for under water borrowers


@tiff wrote:
Hi I'm trying to refi my home. In a 8% conventional loan. Great credit scores. The home is coming in 21,000 lower than what's needed to refi. I need to know my options. The loan isn't owed by fannie Mae or Freddie Mac. What are my options for refinancing without destroying my credit score. I can afford the payment, but I'm throwing away lots of money.

What is the balance of your loan and the approximate current value of the property?  Is it feasible to do a cash-in refi, in which you pay the $21,000 to bring down your loan balance to an 80% LTV ratio?

 

If you have a fairly large loan balance (e.g. $500,000), then if you were able to refi to a 4.5% loan, for example, you'd probably be able to recover that $21,000 in a few years.  It would mean some short term pocketbook pain, but would pay off in the long run.

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