Question by labellewg: Refinancing my Mortgage?
I have about 350K left to pay off on my mortgage. The housing market being what it is the value of my home has dropped below the 350K I have left to pay off. I am looking into refinancing to a lower rate but was told that my “Loan to Value” amount was off and I’d need to borrow more than my house is currently worth. Most lenders won’t do that.
Is this correct?
Are there any other options for me?
Answer by David M
Nobody is going to loan you more money than your house is worth. I’m not sure how you got there (previous refinancing,very little down when you bought, bought your place at the height of the real estate boom) but you need to turn that around before you can refinance. There’s only two ways that’s going to happen. Increasing the value of your home or pay down the debt. Since the market has more influence over the value of your home than you do, you need to pay down your debt.
The best way to do that is to increase your monthly payments. 100% of any extra dollars you put to your payments goes directly to reducing your debt. And by reducing debt, you make more of your future payments go to principal and less to interest, so it feeds on itself.
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That is correct. No lender will lend more than the current value of the house and nowadays most will not touch anything over 90% LTV.
Depending on location (ZIP / County), we might be able to go up to 110%. We would need more details on your situation in order to respond properly. If interested, please fill out my brief RFQ (Request For Quote) form at mortgageoffice dot com (it comes directly to me) and I will respond quickly.