Unemployed friend wants to do a NO DOC Cash Out Refinance, is it possible? (home loan, interest rate)

[Refugee56]

Four years ago I was broke and unemployed. I needed money fast and was desparate. I owned my own home and had quite a bit of equity in it. I was paying 7.12% on a thirty year conventional mortgage.

I determined I needed $50,000 to tide me over until I could line up a new job. My FICO score was 720.

So I went to a number of mortgage brokers and told them about my situation. One got me a NO DOC at 5.87% interest with the $50,000 cash out. My old mortgage was $240,000 and my new mortgage was $290,000. But because my new interest rate was much lower, my monthly payments were about the same.

The $50,000 in my cash out really helped me survive during a long hard job hunt. I eventually got a real good job 9 months later, and got back on my feet.

Anyway I was telling a friend of mine who is currently unemployed. He asked me if it would be possible to do what I did four years ago today. He is also broke, desparate, but has a very high FICO score and still lots of equity in his home. He would like to do a similar no doc refinance cash out.

What do you think?

[Annemieke Roell]

I am not in the mortgage business but have a feeling that those days are over ......

[whatshouldido]

No, it's probably not going to happen. But it also depends on variables you haven't described. Particularly; location and amount of equity.

[Rick Lee]

I can't imagine you'd be able to pull that off again these days.

[Rose Red]

I'm glad it worked out for you in your time of need. However, I believe those loans are now over.

[rcarrillo]

Yeah.... these days a no doc loan is hard to come by... and the rate won't be low. Lenders don't want to take on risk, and giving money to someone with no job is risky.

I am really glad it worked out for you and that is a good example of when a no doc loan is a good option. All of these products had a reason and when used properly helped a lot of people. Unfortunately, when they were used improperly and the standards for getting them were next to zero... we know what happens.

[Refugee56]

If NO Doc Loans do not exist now, why do I see them advertised on web pages all over the Internet.

I never have to list my income on Credit Card Applicantions even now. Similar to a NO Doc. The key is my FICO Score.

Should I tell my unemployed friend, he is heading to homelessness?

[whatshouldido]

Please copy and paste the ads "all over the internet" so we can see them. They don't exists anymore. Lenders are much more careful what they advertise these days.

[whatshouldido]

Furthermore, if your friend has enough equity and is willing sign his house over should he miss a payment, I'm sure there are private or hard money firms that will loan him the money. Again, the questions are how much equity your friend has, where is the property located, and what terms is your friend agreeable to? For instance, your friend owes 50K on a condo located in Manhattan that is worth 750K (even in today's market), he will undoubtedly find someone willing to loan him some money. Maybe not necessarily a bank. Now, if he has a house in Las Vegas that he owes 400K on and he believes it's worth 500K, then probably not. Make sense?

[Refugee56]

Originally Posted by whatshouldido

Please copy and paste the ads "all over the internet" so we can see them. They don't exists anymore. Lenders are much more careful what they advertise these days.

Here you go:

Best No Doc Loans - No income documentation mortgage home loans for wage earners and the self-employed

https://www.quickenloans.com/home-bu...doc-home-loans

No-doc/low-doc mortgages more expensive