Question by answer-man: Will I lose my house if bank refuses to refinance?
So I have been in my house for 11 years and have paid ALWAYS on time. I have 800 plus credit score, over a quarter million dollar in assets, but the Wells Fargo Bank is giving me a hard time to refinance because my wife and I are both self employed. We have provided tax returns and everything else that they have asked for but now they are bitching why our income went down 10% from 2010 to 2011. By refinancing our payment will go down from $ 1600 to $ 1200 so it will be nice to have that extra money.
What is the worst case scenario? If they refuse to refinance can we just keep living in the house as long as we pay the higher mortgage amount, which does not seem like a problem to us? Will a rejection affect our credit scores?
Answer by Go with the flow
Keep paying, they can’t touch your home.
The inquiry to your credit is 1 or 2 points and it’s temporary.
It almost sounds like you are refinancing for a longer term than what you currently have left
Please make sure you do not make this fatal financial mistake.
19 years left in your mortgage?
You better re-fi for a 15 year mortgage.
You want revenge?
Start paying extra towards your principal if you have your emergency savings fund in place and no other debt.
Add your own answer in the comments!
Hi the refi refusal does not change your existing terms with your current mortgage. As long as you pay on time you will be fine. This should not effect your credit. That only happens if you were to go to several mortgage lenders and have them pull credit. However, with a 800 credit score there is not much for concern here.
You want to consider going another lender. Each lender has different guidelines so therefore I am so you can find a mortgage lender willing refi your mortgage. Well Fargo is very conservative anyway.
Their refusal to refinance does not affect your current loan that you have been paying on time for 11 years. Also, the rejection will not affect your credit score. The credit inquiry they made may temporary cause a minor fluctuation, but that happens any time you apply for credit.
Rejection might hurt your credit a little, but as long as you continue to pay your mortgage, you keep the house.
WHy not just go to a different lender?
Forget that bank and call a mortgage broker. it’s their job to shop the rates and jump thru hoops for you and it costs nothing!
Most are paid by the lenders after the deals are signed. there are tons of lenders looking for people just like you. Wells Fargo can then lose your business. They earned that.
Yeah, you already have your mortgage so you can stay with the current payments.
Why don’t you just try another bank? If you have the assets (liquid assets are the ones that really count), the income (you don’t actually give your income) and the credit score you say you do, then you should qualify for a loan from any number of banks. Find a broker willing to eat the closing costs and go from there.
Think about this situation from the bank’s perspective; what is their incentive to refinance your mortgage and lose the higher payment amount you currently pay? They are going to work hard to be paid less at the end of the day. The only reason they are considering it is because you could simply move your mortgage elsewhere, which I suggest you consider trying anyway to see if you can get a better rate elsewhere.
You can continue to pay the higher amount and a rejection will not affect your credit score.