Posted on: 11th Sep, 2007 02:44 am
hi, i'm in florida, need a loan for 100% full doc , cash out refinance on a primary residence. i need a decent rate i approached some banks but that's too high a rate. it can be interest-only as i have some credit cards to get rid off. i need to borrow $300,000 for a single family residential property. fico score is 675 and the property is owner-occupied.
Interest-only is ok but why not go for a fully-amortized loan?
Hi Rip,
If you consider taking an interest-only mortgage, you will get the flexibility of making the principal payments at any time during the term as in the initial period, you will pay only towards the interest. By paying only the interest amount, you can increase your cash flow and utilize the cash for repaying your credit cards.
But such loans can be variable and can rise or fall every month. So your payments can fluctuate. Also at the end of the loan term, you will have to pay the principal amount in a lump sum. Before taking an interest-only loan, you should check out if the current market rate of this loan is lower than your existing mortgage. Otherwise, there is no reason to refinance.
To know whether interest-only loan is a good or bad deal, you may refer to http://www.mortgagefit.com/discuss/interestonly-benefits.html
If you consider taking an interest-only mortgage, you will get the flexibility of making the principal payments at any time during the term as in the initial period, you will pay only towards the interest. By paying only the interest amount, you can increase your cash flow and utilize the cash for repaying your credit cards.
But such loans can be variable and can rise or fall every month. So your payments can fluctuate. Also at the end of the loan term, you will have to pay the principal amount in a lump sum. Before taking an interest-only loan, you should check out if the current market rate of this loan is lower than your existing mortgage. Otherwise, there is no reason to refinance.
To know whether interest-only loan is a good or bad deal, you may refer to http://www.mortgagefit.com/discuss/interestonly-benefits.html
If you can lower your expectations a bit, a FHA cash out refinance offers an attractive blend between a high loan to value & low interest rate.
For a rate in the high 6s/low 7s, you could qualify for a 95% cash out refinance with a mortgage insurance factor of .25.
Issues like total monthly savings and holding period (how long you intend to hold the mortgage/live in the property) need to be weighed into your decision on whether or not you should refinance.
Regards,
Scott Miller
For a rate in the high 6s/low 7s, you could qualify for a 95% cash out refinance with a mortgage insurance factor of .25.
Issues like total monthly savings and holding period (how long you intend to hold the mortgage/live in the property) need to be weighed into your decision on whether or not you should refinance.
Regards,
Scott Miller
FHA cash out refinance?? you mean i need to borrow less that what i'd thought of? and someone told me about strreamline refinance? is thta applicable here?
Is your existing mortgage an fha insured one? Streamline refinance is applicable if the mortgage that is to be refinanced is already an fha mortgage.
You can read more about streamline refinance from this page : http://www.hud.gov/offices/hsg/sfh/buying/streamli.cfm
You can read more about streamline refinance from this page : http://www.hud.gov/offices/hsg/sfh/buying/streamli.cfm
No Rip,
Streamline refinance is only applicable if your exiting loan is an FHA insured one as said by Niicss. Otherwise, you will not get that loan.
Streamline refinance is only applicable if your exiting loan is an FHA insured one as said by Niicss. Otherwise, you will not get that loan.
Hi Rip,
As Scott said, it will be a good option to consider an FHA loan for the refinance. You may get other loans in the market but at a 6-7% rate, getting 95% financing isn't that easy. But I personally this is omething you can find with the FHA insured loans.
However, you need to have a good debt-to-income ratio (your total debt payment being 41% of your gross monthly income) and there should be sufficient savings and cash reserves as well. I am just concerned over the credit cards that you have. If they aren't too many, then hopefully your debt-to-income ratio will be a decent one.
On the other hand, if you are aren't qualifying for an FHA loan, then you may try out with some private lenders as well.
Good luck
As Scott said, it will be a good option to consider an FHA loan for the refinance. You may get other loans in the market but at a 6-7% rate, getting 95% financing isn't that easy. But I personally this is omething you can find with the FHA insured loans.
However, you need to have a good debt-to-income ratio (your total debt payment being 41% of your gross monthly income) and there should be sufficient savings and cash reserves as well. I am just concerned over the credit cards that you have. If they aren't too many, then hopefully your debt-to-income ratio will be a decent one.
On the other hand, if you are aren't qualifying for an FHA loan, then you may try out with some private lenders as well.
Good luck