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I was trying to refinance my home but was denied because I had pulled cash out on a refinance 2 years ago. I was told it was an A9 loan and could not refinance per Texas law until that loan was paid off. Can anyone verify and properly explain this to me. Crying or Very sad

jameshogg · Posted: Wed Oct 29, 2008 12:42 am Post subject:

Hi hector!

If you pay off the loan, then there will be no need to refinance it. Can you tell what exactly the lender is telling you? It will help me to answer your question in a better way. And in case you want to know more about Texas A6 law, you can check the given link:
http://www.mortgagefit.com/texas/a6loan-law.html

Thanks.

bearboysj · Joined: 25 Oct 2008 Posts: 42 17.02 Dollars($)

Texas lending laws are completely different than the rest of the world.

Texas equity law prevents a borrower from doing 2 cash out refinances in a 12 month period - if you were denied because you did one 24 months ago, then maybe this is a particular lender or investor guideline.

You should be able to do another cash out refinance on your property since its been over 12 months - I would either contact the lender again and recheck the recording date of the last equity deed or find another lender.

I am a texas cash out underwriter for the bank I work for.

brian1 · Posted: Wed Oct 29, 2008 6:18 pm Post subject:

Is it because you owe more than 80%? My understanding is that in TX you cannot do a cashout refinance (or pay off a cash out refi) if the loan to value is greater than 80%?

Good Luck
Brian

bearboysj · Joined: 25 Oct 2008 Posts: 42 17.02 Dollars($)

That is correct, you can only do up to 80% LTV/CLTV on Texas Cash outs .. the other thing to remember - once a cash out, always a cash out. This is the thing most 'out of texas' lenders don't check for.

Also, on rate/term in texas, the rule of $2000 or 2% does not apply, if even $1 is taken out it is considered an equity reduction and will force your loan into a cash out status.

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