refi a rental possibly underwater and non compliant with zoneing

If Fannie or Freddie currently own your loan, you may qualify for the new Harp 2.0 program. Check the following sites to see if they do.http://www.freddiemac.com/mymortgage http://www.fanniemae.com/loanlookupThe zoning shouldn't be an issue as long as the local zoning office would provide a rebuild letter stating you can rebuild the home in the event of a fire. If you meet both of the above requirements, I'd be able to help you get the fixed rate loan your looking for.

I can't speak for Rockford, but with most cities, you are grandfathered until such time as you either tear down or want to make improvements that would change the current use. Assuming this is the case, the change in zoning status shouldn't change your options. If your current loan is either FNMA or FHLMC, then you should qualify under the expanded HARP 2.0. Contact a local Mortgage Banker/Broker, rather than one of the big banks or National Mortgage Mills. Unlike their employees, who are most likely just order takers, 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

You have a complex situation... refinancing is possible if it's a conventional loan owned by Freddie or Fannie under the HARP 2.0 program, but because of the zoning issue you should only use a LOCAL mortgage broker, not a bank, but someone who is familiar with local customs... Here in AZ it wouldn't be an issue, but not sure in IL... WilliamAcres.com

Pretty much echoing what others have said. You can probably lock into a fixed rate if you have a loan financed by Fannie or Freddie (look up addresses provided by Todd in the first answer above). Keep in mind that changing to a fixed rate will probably mean a higher rate than you currently pay and increase in your payment (unless you stretch the term out further). On the other hand, $65,000 isn't that large an amount in the big picture and the difference in payment won't be substantial and you might as well lock in while rates are still low. Not knowing your local values, $65,000 seems low unless it has to do wit the condition of the property. If if the building is in need of improvements and would be worth significantly more when improved, you might be able to refinance it using a renovation loan and upgrade at the same time. Would require 25% equity after the improvements are done. Good luck!