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Posted: Tue Apr 29, 2008 3:40 pm Post subject: Refinance

I have a home with a loan balance of 336k. Home is worth about 355. My rate is 9.625. I have had this loan for over a year and it is through Chase. Can I refinance this loan to a lower rate or an interest only product? I am also eligible for a VA loan. This property was originally purchased with the VA loan program, however when Chase refinanced it they did not go that route.

larry · Joined: 27 Jun 2007 Posts: 3322 474.67 Dollars($)

Hi Guest,

I think you can refinance your present mortgage to get a better rate and terms. I think can even refinance it with much lower rates. I think you need to shop a bit for lenders.

BTW most lenders will check your last 12 months credit history. If you have any late payments then it may have negative effect.

Feel free to ask if you have any further questions.

Best of luck,
Larry

kpatrick · Posted: Wed Apr 30, 2008 5:53 am Post subject:

Hi Guest,

Your challenge is that the highest LTV you can get on any refinance is with FHA and that is 95%. 95% of you value is going to be $337,250...so unless you come out of pocket with closing costs, you probably will not be able to refinance until the value of your home increases.

It may make sense to come out of pocket (if you have any savings) b/c your rate is really high. You will just need to get with a good loan officer and do the math to se what your break-even point is. If you plan to stay in the home for a while, this may be a good route for you.

They could also bump up the rate some and pay your closing costs with the yield on the loan...that way your out of pocket would be less. But using rough numbers, if you reduce your rate by 3% (which is achievable with FHA) you would stand to save about $800 per month, so it is worth looking into.

Kim

helping_user

Yeah you can refinance into a lower rate provided you get a good loan offer. You can go for an interest-only loan also but is there any speacil reason behind it? I mean are your finances ok enough to go for an amortized loan payment? if your income is good enough and you don't much financial liabilities. It's better to stick to an amortized payment plan.

You've said that you are eligible for a VA loan. So, do you want to take out such a loan again? when did you refinance last? are 12 months over since you have refinanced? most lender require a seasoning of 12 months to approve you for refinancing.

To know whether Interest-only loan is a good or bad deal , refer to a previous discussion on this issue.

Thanks.

AlaskaDES · Joined: 04 May 2008 Posts: 28 12.75 Dollars($)

Interest only loans. Great Concept... Essentially paying rent for a house that you think you may own.

Unless you have a special reason behind it, it may not be for you. Why not get the interest only loan to have a small monthly payment but still use what you have to pay off your home faster.

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