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Old 09-11-2013, 08:05 PM
 
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Last year we were 5 months late on our mortgages ; we had three houses, two had mortgages on it and we knew we were moving out of state and the mortgages would be paid out of the proceed of the sales. The tenants left two of the houses due to non payment.

Well fast forward a year, we have no mortgage on our primary residence, owe no student loans, no credit cards and no car loans. But we have a mortgage on our vacation home.

So I am trying to finance our primary residence and pay off the vacation home. Now last year we tried to do that and we were told to wait a year after the last home was sold. We were also told to pay off the credit cards which we did.

Now we are told that our credit is not good enough (660), The properties were not short sale, not foreclosed, no bankruptcy, nothing ; they were all paid in full (plus fees of course). The credit cards were all paid off (about $50,000).

I feel that I would have been better off to foreclose, or short sale or whatever. But being honest and doing the right thing seems like it has hurt us.

So basically because I paid off about $600,000, I am worse off now.
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Old 09-11-2013, 08:08 PM
 
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Time out. Your credit is not the problem. We can do a cashout on your primary and pay off the vacation home. But other components like the amount of cash needed, and value of your primary residence come into play.
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Old 09-12-2013, 10:19 AM
 
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Quote:
Originally Posted by okaydorothy View Post
Last year we were 5 months late on our mortgages ; we had three houses, two had mortgages on it and we knew we were moving out of state and the mortgages would be paid out of the proceed of the sales. The tenants left two of the houses due to non payment.

Well fast forward a year, we have no mortgage on our primary residence, owe no student loans, no credit cards and no car loans. But we have a mortgage on our vacation home.

So I am trying to finance our primary residence and pay off the vacation home. Now last year we tried to do that and we were told to wait a year after the last home was sold. We were also told to pay off the credit cards which we did.

Now we are told that our credit is not good enough (660), The properties were not short sale, not foreclosed, no bankruptcy, nothing ; they were all paid in full (plus fees of course). The credit cards were all paid off (about $50,000).

I feel that I would have been better off to foreclose, or short sale or whatever. But being honest and doing the right thing seems like it has hurt us.

So basically because I paid off about $600,000, I am worse off now.
How are you worse off? What benefit will you gain by sliding the debt from your 2nd home to your primary residence?

The credit portion of credit qualifying is more than just having a high enough score. 660 is high enough, but there is more to it than that. I think you will have to wait until those 5 late mortgage payments are over 2 years old. You typically can't qualify for a new mortgage if you have over 2 mortgage lates in the last 2 years no matter what your score is.
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Old 09-12-2013, 10:53 AM
 
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So why do banks tell you to wait only a year. And why do they keep advertising zero down mortgages etc. it is so frustrating.
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Old 09-12-2013, 10:56 AM
 
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We are looking to finance 50% of the value of our home. We also have a decent amount in savings that we could pay closing costs
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Old 09-12-2013, 11:58 AM
 
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The "wait a year" thing is not making sense in light of no foreclosure or Notice of Default - - when was the last recorded late payment on a mortgage?
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Old 09-12-2013, 12:09 PM
 
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August of 2012. The house was sold in sept 2012. All monies due were paid in full at that stage.
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Old 09-12-2013, 12:10 PM
 
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I am wondering about the "right thing" comment since you brought it up. I can understand the late mortgage payments on the two rentals, things happen, cash flow and all that. Then however, you bring up the vacation home. Did the vacation home exist when you weren't making payments on the two rentals?

Seems like the right thing to do would have been to sell the vacation home, pay on the rentals and then get another vacation home after all was said and done.

Before comments about me talking about the ethics chime in, the OP brought up that subject. Not paying a mortgage while you have a vacation home sitting there seems kind of wanting it all and then complaining when you can't get it.

There is a lot here that doesn't match up. Paid off the primary residence mortgage, credit cards and such but not make mortgage payments on the rental and then complain about not being able to get new financing for the vaca home? How does that work?
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Old 09-12-2013, 12:26 PM
 
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Ok. The rental house was in contract to be bought for a price higher than the mortgage for 9 months, three months into the contract we evicted the tenant for non payment, house was broken into and flooded. The day before the closing, the buyer backed out. Two months later, we did sell it for more than the mortgage and it was paid in total.
We were moving out of state and needed to keep as much cash as possible. The vacation home mortgage was paid on time and that has been on the market for over a year and we continue to drop the price. As I said, yes we were late on payments, we tried to refinance thru harp on the rental property, sent the paperwork 4 times and were told they never got it so we didn't qualify.
Now all our cash is tied up in our primary home, and because of late payments over a year ago, we are told nobody can loan to us. That is the only reason we are given
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Old 09-12-2013, 05:48 PM
 
1,263 posts, read 2,651,591 times
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Quote:
Originally Posted by okaydorothy View Post
So why do banks tell you to wait only a year. And why do they keep advertising zero down mortgages etc. it is so frustrating.
A cash-out loan to 50% of property value on a currently mortgage-free property has vastly different underwriting than a mortgage to purchase a home or to refinance a home-purchase mortgage.

The "0% down" mortgages you've seen advertized were for initial home purchases, which have nothing to do with what you're doing. Even at the height of the housing bubble no bank would have offered someone a 100% cash-out loan on a paid-off house. There's no point in getting frustrated over purchase mortgage terms when you're not purchasing.

As to the approval situation: I don't know who told you about the "wait one year" idea with a dozen mortgage late-pays. And for a cash-out loan?! I'd go back and quiz that person if I were you...

Frankly, I wouldn't lend to you either given your recent payment history on multiple properties. I'd be afraid you were trying to cash-out in advance of doing another "I'm not paying this particular mortgage for five months" thing. And neither of the last two banks I worked for would have lent to you either. Sorry.

Last edited by LOL_Whut; 09-12-2013 at 05:51 PM.. Reason: typo
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