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Smith
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0.10 Dollars($)
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 Posted: Tue Jul 24, 2007 4:18 am Post subject: Can lender cancel Refinance loan due to low Appraisal? |
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We are about to refinance and have already been approved. Now, I'm just awaiting the appraisal. The appraised value is lower than what we expected. But even then it is $12000 higher than what we are borrowing. Do we need to be worried that our refinance approval may be cancelled?
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 sara
Joined: 05 Jul 2006
Posts: 955
Location: New Brunswick, New Jersey
182.56 Dollars($)
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| Posted: Tue Jul 24, 2007 4:27 am Post subject: RE: cancel refinance due to low appraisal |
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Hi Smith,
Welcome to the forums.
Your refinance loan can be cancelled as the amount you borrow is a percentage of the property-value. So, if the appraised value isn't high enough, the lender may not be willing to offer you the loan. Or else, you may have to borrow less. The lender may even charge you a higher rate of interest.
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blue
Joined: 21 Oct 2005
Posts: 1138
Location: MARYLAND
135.05 Dollars($)
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| Posted: Tue Jul 24, 2007 6:41 pm Post subject: |
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Hi Smith,
Welcome to Mortgagefit discussion board.
After this new appraisal the refinance loan will be for what percentage of your property's value? If it is not going over the 80% mark then there is no major concerns which can result in cancellation of your refinance request. And many lenders will be willing to refinance for higher ltv ratios too.
But in Texas for instance a refinance cannot be for more than 80% ltv. So if you are in Texas, check what the refinance is going to be for and if it is crossing the 80% limit because of the lower appraisal you have received.
Thanks
Blue
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Alex12
Guest
0.10 Dollars($)
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| Posted: Wed Jul 25, 2007 5:22 am Post subject: |
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| If your appraised home value is lower than the refinance loan amount, the it is really a matter of concern. It will affect you more if you need extra cash from the refinance. This is because the lender will not be able to provide you with loan amount higher than your home value. |
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mikeshapiro
Moderator
Joined: 04 May 2007
Posts: 67
Location: Phoenix, AZ
27.17 Dollars($)
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| Posted: Thu Jul 26, 2007 12:25 pm Post subject: |
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| Quote: | | But in Texas for instance a refinance cannot be for more than 80% ltv. So if you are in Texas, check what the refinance is going to be for and if it is crossing the 80% limit because of the lower appraisal you have received. |
Wow I did not know that Blue. So lenders cannot loan more than 80% LTV. Is that only for refi purposes?
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blue
Joined: 21 Oct 2005
Posts: 1138
Location: MARYLAND
135.05 Dollars($)
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| Posted: Thu Jul 26, 2007 12:48 pm Post subject: |
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Hi Mike,
It is known as the A6 law and is applicable for cash out refinances. In Texas a cash out refinance can be up to 80% of property value. I myself was not aware of it and came to know just few months back.
I came to know about it after I read this previous discussion on this topic: http://www.mortgagefit.com/texas/a6loan-law.html . Please take a look.
But in my previous post I did a mistake by stating that it was for refinances in general. This rule applies only for cash out.
Thanks
Blue
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mikeshapiro
Moderator
Joined: 04 May 2007
Posts: 67
Location: Phoenix, AZ
27.17 Dollars($)
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| Posted: Thu Jul 26, 2007 12:55 pm Post subject: |
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Hmm. very interesting. Thanks for the link!
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Serving Appraisal needs in Arizona
www.4realvalues.com |
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blue
Joined: 21 Oct 2005
Posts: 1138
Location: MARYLAND
135.05 Dollars($)
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| Posted: Thu Jul 26, 2007 1:18 pm Post subject: |
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