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Old 09-02-2008, 10:51 AM
 
Location: Mount Pleasant, SC
1,791 posts, read 2,297,189 times
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All help will be appreciated...
In February 2009, our 5 year balloon at 4.5% will end...what can we do to prepare for another mortgage to pay it off? We'll owe $180,000 on a house that can easily be appraised at $400K. Great neighborhood, surrounded by great neighborhoods so value is not an issue. What is a concern is that my husband is self-employed & will probably not claim more than $16,000 in gross income this year & I'm salaried at $55,500. No debt except the mortgage. All input on the process of refinancing and what we can expect to be up against is welcome.
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Old 09-02-2008, 12:02 PM
 
Location: Charlotte, North Carolina
5,137 posts, read 15,094,482 times
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Sounds like you wont have an issue refinance....

Find out what the new rate will be before considering refinancing.
I would apply with different lenders besides your current lender.

Most current lenders will not give you the best rate.
A new lender will be willing to lower your rate to win your business..

Quote:
Originally Posted by joyeaux View Post
All help will be appreciated...
In February 2009, our 5 year balloon at 4.5% will end...what can we do to prepare for another mortgage to pay it off? We'll owe $180,000 on a house that can easily be appraised at $400K. Great neighborhood, surrounded by great neighborhoods so value is not an issue. What is a concern is that my husband is self-employed & will probably not claim more than $16,000 in gross income this year & I'm salaried at $55,500. No debt except the mortgage. All input on the process of refinancing and what we can expect to be up against is welcome.
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Old 09-02-2008, 02:40 PM
 
Location: New York
2,251 posts, read 4,161,023 times
Reputation: 1607
Quote:
Originally Posted by joyeaux View Post
All help will be appreciated...
In February 2009, our 5 year balloon at 4.5% will end...what can we do to prepare for another mortgage to pay it off? We'll owe $180,000 on a house that can easily be appraised at $400K. Great neighborhood, surrounded by great neighborhoods so value is not an issue. What is a concern is that my husband is self-employed & will probably not claim more than $16,000 in gross income this year & I'm salaried at $55,500. No debt except the mortgage. All input on the process of refinancing and what we can expect to be up against is welcome.

It sounds like your going to be ok to qualify for a new loan. You have a few options. I suggest you do something before the presidential elections - interest rates are sure to go up.

Your first option you could refinance, looking for a fixed rate in the six percent range (slightly lower for a 20yr term). You could elect to go back into an ARM for a lower rate, but you will have to refinance again in the future. I do not recommend that, each time you eat up equity.

Refinancing they are going to look at your credit score, also you have to pay for an appraisal. Plus there will closing costs that will get rolled into the loan (as much as 5%). The loan officer can give you a rate, and that will be the rate you close with (normally).

When you are shopping between different leaders, you can do two things to help yourself. First - get a copy of your own tri-merge, so each person you talk to, black out your SS# and email your report to them. That way your credit report isn't ran over and over lowering your score. The 2nd thing you can do is order your own appraisal, with the ability to change the lenders name. That way if you get to closing and there's alot of hidden charges that suddenly appear, you can walk away and go to another bank. (On FHA loans once a case number is assigned, it is harder to change lenders.)

Your second option - if you are happy with your current lender, and do not want any cash out. It is cheaper to do a modification. Only 3% of the people who do their own modifications succeed, because they do not know the correct channels in doing so. This is the cheapest method, but your not getting the lowest rate.

Your third option - doing a modification through an attorney firm, which a legal representative acts of your behalf to honestly and legally get you the best interest available.

It is important to note - a loan can only be modified once every year, sometimes only once in the lifetime of the loan.

The rules of this forum prevent me from mentioning my firms name, if you would like to ask me questions, P.M. me.





.
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Old 09-03-2008, 08:35 AM
 
Location: Tampa,FL
54 posts, read 238,603 times
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Very good advice given so far. The refi is a very straighforward thing, or at least it should be if you get an honest person to help you. You are paying the broker for a reason, and that is to make the difficult things seem easy. With those numbers, you should easily qualify for a conventional loan. Dont accept anything but a good fixed rate loan. You may even qualify for a stated program at that LTV, just depends what you want to do. Good luck and dont let anyone make it a difficult and confusing process when it really is not.
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