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epic1 06-27-2010 10:13 AM

My wife and I have about 30-35k worth of equity in our house. We put money down and bought low. The value of our house has not gone down. Our rate is 6ish%.
We want to either refi to a better rate, or use our equity to secure a personal loan. Is the second idea even possible?
We have done some improvments, mostly cosmetic. Could that help our case? Will the house need to be inspected?
What else am I missing?
We want to use the money for a few improvments to the house, and a newer diesel.
Thanks every one.

petrey10 06-28-2010 6:37 AM

your house will need to be reappraised with the updated included with it. Some appraisers will do this before updates are fully completed but most require the updates to be like 90% done I believe. If you current rate is 6ish% I would recommend talking with your loan officer about refinancing. At the bank I am a loan officer at we hit bottom at 4.625% for 30 years last week. And we are a very small bank so bigger banks will be able to get you slightly lower. Many banks will not make a real estate loan nowadays that is higher than 80% of its value. I don't know if you knew this and still have 30-35k left or not but it is definitely something you might need to think about. If you have any other questions don't be afraid to ask

epic1 06-28-2010 3:36 PM

thank you. I read some on home equity lines of credit. Is this worth it?

petrey10 06-29-2010 11:19 AM

to me.... no... I would refinance ur house to take advantage of the lower rate... Then budget for the purchase of the new diesel auto loans can be had at a rate lower than 6%... And if you really want to do the home improvements I would just save up the cash to pay for it in a lump sump... SOme don't realize how much the extra principal on their mortgage costs them. I don't have ur numbers on what your mortgage is so plug them into the calc below and view the amortization chart and watch how the interest rises when you rise the principal amount. Sometimes it blows people's mind. If I can suggest that you try to find a used diesel that fits your needs and desires do it. Diesels last a VERY long time. 150k miles on a diesel truck if it had been well taken care of is the equivalent of 60-70k in gas IMHO... If you have any other questions feel free to email, pm, or post them

ian_ashton 06-29-2010 1:45 PM

I'm a home loan officer with a very large bank.

A few things; Home Equity Line of Credit/Loan - virtually non-existant. With my bank you are looking at a maximum Loan to value of 70% (best case), which means 1st mtg balance + 2nd mtg line amount / appraised value can't exceed 70% On the same token, our minimum line amount is $50k.

So, if you owe $100,000 on your home, you'd need an appraised value of $215,000 to get a Line of Credit with us.

I'd take the above advice and refi the mortgage to a lower rate, anything in the 6's is high. Depending on loan size, value, and credit score you should definately be able to get low 5's with very minimal costs, if any.

If you have any specific questions or want any numbers feel free to shoot me a PM and I'll give you my corporate email.

helinut 06-29-2010 4:36 PM

Is there any way to get a low refi cost? I'm running 6.25% on my house, and would like to cash in on the lower rates, but the costs of of a refi make it not work out unless I stay at this house at least another 4 years.

Any ideas?

ian_ashton 06-29-2010 7:03 PM

You can take a slightly higher than market rate and use the spread to subsidize the closing costs.

Feel free to message the details of your loan and I can get you some more details of what you want to look for.

hollywood1971 06-30-2010 10:46 AM

I also am a loan officer and depending on what state you live in I can help you out.. Some banks (US Bank) are still offering 2nd mortgages/ equity lines. I would not recommend doing this though. Rate may be low now but they will be going up. You need to consider your blended rate of your 1st and 2nd. I would take advantage of todays low rates and just get a new 1st which will be lower then what you have now. If your loan to value is over 80% you will still be ok. FHA will allow a 96.5% loan to value depending on your loan amount.

ian_ashton 06-30-2010 12:14 PM

Max LTV on FHA is 85% for a cash-out transaction, 96.5% for NCO or Purchase.

I wouldn't reccomend going from a Conventional without MI to an FHA that will have mortgage insurance for a possible 1% savings. The interest savings will be lost on the MI.

If you are over 80% loan to value Conventional contact your current lender and see if you are eligable for a HARP (Home Affordable Refinance Program) refinance aka- ObamaLoan.

f you are currently on an FHA loan you can do an FHA Streamline Refinance, which will usually have no closing costs (subsidized by the rate), but FHA has their own fee, which is 2.25% (Up Front Mortgage Insurance Premium - UFMIP) which is added on to the principal balance of your loan. This fee is the same with all lenders.

bruizza 06-30-2010 1:01 PM

I am currently refinancing my house from a rate in the low 6s to 5 and it is only costing me $415 out of pocket. Closing costs are being rolled into the new loan. I drop my payment $150 a month and in 3 months I have made back the out of pocket expenses. I have only been in my place about 18 months so. I am going from a FHA loan to a private loan. Call around and see what you can get.

epic1 06-30-2010 3:45 PM

right on, thanks guys.
thanks for trying to politisize every post Ian.

phatboypimp 06-30-2010 3:54 PM

An important thing to remember is when you re-finance is that you are going to add to the years that you are financing your home and that should be calculated into the cost of refinancing. Although you might be able to amortirize the immediate costs of refinancing (which actually means your are paying interest on your fees - never a good idea), you are now back to a 30 year loan (versus 25 years if you paid on your house for five years) and you need to calculate those additional years of interest as additional costs to refi. I know that most people never make it to the end of a 30 year mortgage, but something to keep in mind.

petrey10 07-01-2010 7:10 AM

^^^^ you don't have to add years to your refi at all... if you just want to take advantage of a lower interest rate you just modify the loan...

ian_ashton 07-01-2010 8:44 AM


Originally Posted by epic1 (Post 1603508)
right on, thanks guys.
thanks for trying to politisize every post Ian.

Politisize? I was just trying to post accurate information, as the internet is full of mis-information. Sorry for caring, and good luck with your financing.

clayton191 07-02-2010 12:12 AM

RUDE. What a douche -- dude was givin' you decent information....

jclevoy 07-02-2010 3:29 AM


Originally Posted by epic1 (Post 1602554)
thank you. I read some on home equity lines of credit. Is this worth it?

I HIGHLY recommend a HELOC (home equity line of credit). I have one for $50k and the rate is 4.5% It is used basically like a low-interest CC. If you must borrow money, it is one of the best ways to do it IMHO. BTW, when I got my HELOC set-up, there was no appraisal fee, and there were no refinancing fees. I didn't pay a dime out-of-pocket.

I may have special circumstances though............I owe about 30% of the appraised value of my estate.

epic1 07-02-2010 12:53 PM

and he helped, thats why I said thanks. douche.

epic1 07-02-2010 12:54 PM

if he needs to talk about obamaloans, thats the gen discusion.

hyperlite 07-02-2010 1:04 PM

get with your banker....depends on the bank and local economy

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