Our 5/1 ARM interest only (non-Freddie Mac) home equity loan expires March 2012.

I agree with William and Marc. FHA is a good alternative assuming you haven't had any draws against the Home Equity Line in the last 12 months; then it's still considered a rate & term refinance. If that doesn't work, you can try to subordinate that 2nd mortgage, but it's still going to be up to Amerisave to approve that, and my guess is that's not very likely based on your conversation with them you mentioned above. I would agree to try to find a local mortgage broker, as well; then you can let the loan officer do the shopping work for you, and statistics still show that brokers are generally the cheapest way to go, too...not to mention that we're more educated, regulated and transparent than banks are required to be.

You shold find a local mortgage broker, not a bank, and apply with them... there are options for you with FHA refinance.. you can refinace up to 97.75%, and if they don't consider the 2nd to be purchased money, you can still do a refinance and have the 2nd subordinate. WilliamAcres.com

If the second mortgage was used to pay for improvements and you can show this, FHA should not treat these funds as cash out. If some of funds were used for other purposes, it may be harder, but subordination is an option. The best thing to do is to contact a local Mortgage Banker/Broker, rather than one of the big banks. Unlike a bank employee, who is most likely just an order taker, a Mortgage Broker/Banker is Trained, Tested and Licensed in all aspects of Mortgage Origination. He/She will have access to loan products of many lenders, not just those of one bank, and can properly guide you. But more importantly, He/She is trained to take a look at the various different options available to you and guide you into the one that makes the best sense for your situation. Don't forget to check out your selected Mortgage Originator at the National Mortgage Licensing System at www.NMLSConsumerAccess.org ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com

Hi Amy, I can help you, call me or email and I will piece this puzzle together and come up with the best rate and term possible. I,m local in Florida for 12 years now and have a lot of experience with deals like this...best of luck either way

There are other options out there instead of conventional financing. I believe FHA may be the best route to getting your home refinanced upto 97.75%. However, if the home equity was used to purchase/construct the home, you should be able to qualify for a conventional loan at 90% ltv. Please call me to discuss all of your options. We have many banks to work with.Home 1st LendingMarc Asaad407-330-0947