Anonymous
Anonymous asked in Business & FinancePersonal Finance · 1 decade ago

Refinance a traditional mortgage and 2nd mortgage?

Can I refinance my 2 loans together. I have a traditional and a 2nd. Should I just refi one or the other?

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  • Gem
    Lv 7
    1 decade ago
    Best Answer

    This depends on a few things.

    Is the combined loan balance less than 80% of your homes market value?

    Is your credit as good or better than when you took out the loans?

    After you figure in all the additional fees and costs, is it worth it?

    If you are going to refi, the best place to go first is to your current mortgage holder and see what they can do. If you have been a good customer they won't want to lose you and may cut you a great deal.

    Beware of these independent brokers as they are a huge part of the problem and are still breaking the law to keep their own butts in money.

    Good luck.

  • 1 decade ago

    Before you can determine whether or not a refinance is a viable option for you, you need to determine how much refinancing you home will cost.

    Refinancing your mortgage can be a very expensive process, as closing costs, appraisal fees, broker fees, penalties, etc., can quickly add up to well over $10,000, or even more. The question of how much your refinance will cost is very difficult to answer, as I do not know if any pre-payment penalties will be charged by your current lender or what closing costs will be charged by your new lender.

    First, you need to contact your current lender to find out if any early refinance penalties will be charged, and when you can refinance without penalty. You should then contact several different mortgage lenders to discuss the loan terms they can offer you based on your current financial situation.

    Once you have determined what the refinance will cost in terms of penalty charges and fees, and what new loan terms are available to you, you can weigh the two options against one another to determine if the terms offered on the new loan will save you enough money to outweigh the cost of refinancing your current mortgage. If you find that you will save more money by moving forward with a refinance now, then by all means, I encourage you to do so. However, if the costs outweigh the savings on your new loan, then you may want to wait until your penalty period has expired before you move forward with a refinance or until you are able to refinance at a lower interest rate.

    It is important that you find out the details of any penalty clause of your current loan as soon as possible so you can discuss the implications of a refinance loan with possible lenders.

    I wish you the best of luck in obtaining a refinance loan that will save you money.

  • 1 decade ago

    Any loan that you can refi into a lower rate, you should. If you want to leave the 2nd mortgage open, that lender will charge you an average of $150 to resubordinate to the new 1st mortgage, plus there will be a doc prep and recording fee involved for the subordination. Figure $300-350 to leave a 2nd mortgage open.

    If you are in PA, I'd be glad to help. I have 12 years experience as a mortgage broker. http://www.pottstownmortgage.com/

  • Anonymous
    1 decade ago

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  • 1 decade ago

    You can do it if you qualify for one: credit history, equity based on a new appraisal, if it saves you money in the long run, depending how long you plan to stay there.

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