Why would lenders refinace loans less than 50,000??

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Len S

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Post Posted: Thu Sep 20, 2012 8:32 am    Post subject: Why would lenders refinace loans less than 50,000??
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Help, I have want to refinance a mortgage for $40,000 dollars but none of the lenders will do it unless its $50,000 or greater? What the hell gives with that. Its not right. How can we who have paid down our loans, never been late on payments take advantage of lower rates and terms and save money that could be put back into the economy to stimulate job grow.

I don get it, the government needs to mandate that loans for borrowing should not have a lower limit or it should be as low as $20,000. This is so unfair and another indication of our misguided finical infrastructure.

Very frustrated and confused here....

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Icon Mini Profile chrisgummerson
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Post Posted: Thu Sep 20, 2012 3:03 pm    Post subject:
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Hi,
The issue would be with the lender. Most lenders will not lend under 80k or so, as their is no proffit. You can find local community banks or your credit union who would be able to give you that loan amount. Just like in any business, there are specialties and niches that each lender may or may not participate in. Good luck.

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Icon Mini Profile jameshogg
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Post Posted: Thu Sep 20, 2012 7:59 pm    Post subject:
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Hi Len S,

Yes, it is true that lenders try and avoid lending lower amounts as it does not help them make much profit. As Chris has said, you should look out for the option of credit unions who normally lend lower amount of money to borrowers. You can even go for hard money lenders but they will charge you higher interest rates.

Thanks
Icon Mini Profile sabrinatoss
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Post Posted: Thu Sep 20, 2012 11:07 pm    Post subject:
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Hello Lens,

Put simply, your existing loan is bought out and a new deal is agreed, with lower interest rates allowing for lower repayments each month. There is little doubt that when the financial screw is turned, that meeting existing loan repayments is a struggle, so lifting that burden is necessary.

Idea

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Post Posted: Fri Sep 21, 2012 10:30 am    Post subject: Refinance loans under $50,000
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Hi Guest, it might be hard to get significant payment savings on a $40,000 refinance but that aside. Your lender(s) should have explained to you federal law that limits the total amount of fees you can be charged (includes everything not just lender costs).
Because some fees are flat fees they take an inordinate amount of the limit and it prevents any lender from being able to do your refinance.
Good Luck
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