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Cash Out Refi Question..

I purchased my home 2 years ago. Bought it as a short sale, but appraised higher. Estimating home value between 80-90K. Owe 55K on first.I am looking to obtain a 2nd or HELOC for home improvements, cc debt (not much) and additional school costs ~20,000 If I can get more that is fine.Pulled my credit thru myfico.... 685 TU, 678 EQ and I don't know EX, but my primary bank said it was 644 (dont know if it is fico or not)I have paid collections on there (over 2 years old) and NO recent derogs.Full doc, good ratio'sCurrent mortgage is 4.5% fixed, so I would prefer not to touch it.Thanks! by chrisalbert658 from Milaca, Minnesota. Mar 11th 2011 Reply


Todd Tholl (toddtholl@leader1.com)
#4 ranked lender in Iowa - 239 contributions

If you refi your first, you'll be over 80% LTV & need PMI which you don't qualify for on a Conventional program with a 678 score. You'd have to go FHA which isn't the end of the world. Their rates are in the mid 4's currently. I don't do HELOCs but know you'll be capped at 85% LTV & your rate with surely be in the 9's. If interested in discussing a first mtg. refi, give me a call.

Mar 13th 2011
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Chris Gummerson (cgummerson11)
#393 ranked lender in California - 648 contributions

Most of the time, it comes down to cost, total payments, and interest accumulation. Generally it is much more cost effective to redo first mortgages than obtain a second. Second generally have a rate from 8%-15%, and many lenders dont originate seconds anymore. If you were to blend a 1st and 2nd mortgage rate together, you would notice that your actual rate on both mortgages is 6-7% or higher, depending on the 2nd int. rate. Also, keep in mind that Conventional loans are in the 4.5% range and the same for FHA loans. If a second was trully your goal, your local bank might be your best option. What state is your property?

Mar 11th 2011
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Dear Chris,I don't see an issue with doing the refi. You seem to meet all the underwriting guidelines. We would have to complete an appraisal of course. Other than that I can probably lock in your rate somewhere between 4% - 4.25%, depending on the mortgage terms. We can also close this loan in 25 days! Let me know when you want to get started! Joe SanchezVA Loan Specialistjsanchez@westtownsb.com646-736-0392I am in the process of doing some modifications on this website. Just email me if you have a problem getting back in.

Mar 11th 2011
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Rich Constantine (rconstantine)
#395 ranked lender in California - 79 contributions

I know that we do not originate seconds or HELOCs at our bank! Your best option is to lock into a new 30 year fixed term or shorter term for a better rate. Since the rates are so low now and would probably be the last time you refinance the mortgage. If you really need the cash, consider taking the cash-out on a new mortgage on one loan. Maybe your local bank would do a HELOC? You can email me for more info @ rconstantine@myhsoa.com. My name is Rich. Hope this helps. RC

Mar 12th 2011
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