Need advice - Our house is underwater and we need to refinance
Hello all,My name is David and this is my first post here. I have been trying to research ways to refinance underwater mortgages and my head is spinning. Years ago my wife and I purchased our home for $77k with a VA loan, no money down. After about 15 years we started having problems and were on the verge of divorce. My plan was to purchase my own place so I basically sold the house to my wife for $1 and she got her own mortgage, probably with a balance in the mid $60k's. Turns out that we eventually reconciled and we are still together in this house. The problem is, she is a spendthrift and took out a 2nd mortgage in order to pay off her credit card debt. She reasoned that she would then be able to deduct the interest on her taxes. Problem is, she ran the credit cards up again and did it again. This happened two or three times and she now has a 1st mortgage of about $223k and the house is probably worth around $170k. Back in 2008 it was listed as being worth $225. Her interest rate is at 10% fixed thru Citifinancial. She has called them many times asking about a loan modification and they refuse to do anything. I'm not surprised as she is sort of a golden goose for them. At this point I'm not sure what type of mortgage she has, but Citifinancial says that it is not a Fannie Mae or Freddie Mac backed mortgage. The monthly payment is just over $2k, with most going to interest. At this rate we'll never pay it down. I would be willing to go back on a mortgage and can put down around $40k from savings if that would help. She makes about $75k per year and has been steadily employed for over 30 years. She is current on the mortgage but a 10% rate is ridiculous these days. Is there any relief available and if so, what can we do to start the process. Thanks in advance for any advice. by mattmc_533_206 from Bastrop, Louisiana. Apr 26th 2012
William J Acres (William_Acres)
#74 ranked lender in Arizona - 8,728 contributions
Ok... so there is the HARP 2.0, but this refinance program is strictly for Fannie/Freddie owned loans.. and if your current lender will not refinance you (and why would they.. if you've made your payments on time, you obviously can afford it) then there's no relief there... a true Loan Modification is probably not the answer for you either.. Most are a scam, they rarely ever work, the relief you would get is minimal in most cases, you have to damage your credit to qualify, and most folks get turned down... this is not the path you want to take... The good news is that there is help on the way... President Obama talked about another refinance program in the works.. it's been called HARP 3.0, and it's a refinance program for all those other people (Like yourself) who have loan products that don't qualify for all the current refinance programs... there has been nothing submitted to congress, and none of the details are out but more than likely it will be an FHA product, and it will probably have mortgage insurance, but even with MI, from your 10% rate to even a 5% to 6% rate would be a HUGE improvement... My guess is that you will probably see it soon as I'm sure the President would want to brag about it during his campaigning... so I think there's help on the horizon... Stay tuned!!! I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com
Bert Carpenter (BertCarpenter)
#37 ranked lender in Arizona - 2,431 contributions
I have heard the same rumors as William, and agree with Larry, that it may not happen soon. Personally, I think it will happen, especially if it can be done via executive order. If not, then nothing will happen with this Congress, meaning it could be another year or longer. If you really love this house and want to keep it, then there are several additional facts I would need to get from you to be able to give you additional advice. If you would like to discuss this further with me, give me a call. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com
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