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Does it make sense to try and refinance in this situation?
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lbelle821
Arghhhhh
Member since 2/06 5285 total posts
Name:
Lisa
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Does it make sense to try and refinance in this situation?
We just did a large addition to our home. In order to do it we took out a specialty loan (not an FHA or construction loan) which allowed us to borrow on the future value of the home. Because it is a niche product the interest rate was a little higher than the conventional 30 year loans at the time. We are paying 4.875. The construction is now done. Does it make sense to try and refinance to a conventional 30 year or even a 15 year if the payment isn't too high? Any insight as to what the best products are that are out there with low/no closing costs?
TIA!
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Posted 1/3/12 3:46 PM  |
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lbelle821
Arghhhhh
Member since 2/06 5285 total posts
Name:
Lisa
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Re: Does it make sense to try and refinance in this situation?
BUMP 
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| Posted 1/4/12 9:25 AM |
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Blu-ize
Plan B is Now Plan A
Member since 7/05 32475 total posts
Name:
Susan
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Re: Does it make sense to try and refinance in this situation?
Too many factors to make that call here but a 30 year would not pay most likely. 15 year may.
Are you staying in your home forever?
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| Posted 1/4/12 10:44 AM |
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lbelle821
Arghhhhh
Member since 2/06 5285 total posts
Name:
Lisa
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Re: Does it make sense to try and refinance in this situation?
yes, forever
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| Posted 1/4/12 11:39 AM |
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FranM
And so it goes....
Member since 9/05 2217 total posts
Name:
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Re: Does it make sense to try and refinance in this situation?
You have to crunch the numbers. What is the rate on your underlying mortgage?
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| Posted 1/4/12 12:50 PM |
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want2beamom
Love my boys soooo much!!!
Member since 8/06 10164 total posts
Name:
True love doesn't end with happily ever after...
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Re: Does it make sense to try and refinance in this situation?
Can I ask you what type of loan you got to do the addition...we r looking into this....I talked to someone from Wells Fargo, and they mentioned a loan like this
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| Posted 1/4/12 1:38 PM |
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lbelle821
Arghhhhh
Member since 2/06 5285 total posts
Name:
Lisa
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Re: Does it make sense to try and refinance in this situation?
4.875% is the rate of my current mortgage.
I don't know what the name of the loan is. I got it through Boiling Springs Savings Bank in New Jersey (where we live). I actually used a broker which was more expensive so I would recommend going to them directly to cut that cost out.
Anyway, the requirements are that you need 20% equity in the home now (or pay down your mortgage so that you do) AND 20% equity in the future value of your home. That is all they will lend you. Plus your credit has to be really good.
Other than the broker fee I paid I found it to be the "cheapest" option because all of the FHA loans had the upfron PMI costs plus mandatory PMI for 5 years.
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| Posted 1/4/12 2:34 PM |
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