St. Louis Mortgage Help

Refinancing an Underwater Mortgage - St. Louis, St. Charles and Missouri - FHA and Conventional

August 2nd, 2011 11:29 AM by Bob Rutledge

Refinancing your underwater mortgage, you do have options! Is your home underwater? You would like to refinance to a lower interest rate, save money every month, or shorten the term of your mortgage? There are just a few options available to home owners who has a mortgage that's underwater in St. Charles, St. Louis and the entire area. If you live in Missouri I may be able to help you.

With the steep drops in home values in recent years, many homeowners in the St. Louis Mo area and Missouri who would like to refinance their mortgage to take advantage of the dirt cheap interest rates now available have been unable to do so, because they owe more than their property is worth. But now they have an option. Options do exist, especially via the government's Making Home Affordable Program

CONVENTIONAL MORTGAGE OPTIONS

If you meet certain criteria, your underwater home loan may be eligible for a refinance through the Federal Home Affordable Refinance Program, or HARP. The program allows qualified borrowers to refinance a mortgage that is from 105% to as high as 125% of the home's value, as determined by a new appraisal.

However, not every underwater loan qualifies for HARP. First, you must not be on the road to foreclosure: Any delinquent payments in the past 12 months will automatically disqualify you from eligibility.

Second, either Fannie Mae or Freddie Mac must own the loan. You can find a loan lookup tool and other calculators at the government's Making Home Affordable Web site.

Your ability to take advantage of HARP will depend on payment history and other factors including credit score, the structure of the current home financing and specific lender guidelines.

If your mortgage application is recognized as a DU Refi Plus you will have the same options available to you but with no credit score qualification. Your mortgage will have to have been owned by Fannie Mae prior to June 1st, 2009.

GIVE ME A CALL TO HELP YOU DETERMINE IF YOU QUALIFY.

If you feel your mortgages is within the 125% maximum loan to value, you are current, have decent or better credit, and your mortgage is owned by Fannie Mae or Freddie Mac you may have the ability to refinance your mortgage even though you are underwater.

FHA MORTGAGE OPTIONS

If you currently have a FHA mortgage and find yourself underwater you can refinance to another FHA mortgage if you currently have a second mortgage and your combined loan to value doesn't exceed 125%. The new first mortgage cannot exceed 97.75% of the established value of your home and the combine balance of your new first and your old second mortgage cannot exceed the 125% maximum combined loan to value.

Confused yet? The easiest way to determine if you can refinance your current FHA mortgage that may be underwater is to give me a call and within about 15 to 20 minutes I will be able to give you some very solid answers and possibly have you on your way to a much better mortgage situation.

NEAR UNDERWATER OPTION

What if you are really close to being underwater on your mortgage? The FHA mortgage will allow you to refinance to 97.75% of the appraised value of your home. There are a few pluses and minuses to refinancing from a conventional mortgage to an FHA mortgage, the biggest minus is mortgage insurance if you don't have it currently.

If you loan to value is at 95% it may very well be possible to avoid mortgage insurance, get a lower interest rate and save every month on your house payment. Conventional refinancing does allow up to a 95% loan to value on a rate and term refinance and yes mortgage insurance will be required. By taking advantage of today's very low interest rates it is very likely through a lender credit we can eliminate the mortgage insurance and create huge savings for you.

IF YOU ARE UNDERWATER ON YOUR MORTGAGE AND WANT TO REFINANCE YOU HAVE OPTIONS! GIVE ME A CALL AND WE WILL FIND OUT WHAT OPTIONS ARE AVAILABLE TO YOU.

Posted in:General
Posted by Bob Rutledge on August 2nd, 2011 11:29 AM

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