Question by Nick B: How can I lower my mortgage payment?
We own a house, we originally paid 160K for and now owe about 147K. We have a 6.75 fixed intrest rate for 30 years. We would like to refinance, but we have lender paid PMI, and so far our options havent been saving us more than 100 dollars a month. We are currently using a broker, should we try a bank. Also, should I consider contacting my current mortgage company? We have no change in income, but apparently got in over our head with debt.
Best answer:
Answer by Zarg222
depending on when you bought it, it might be worth less than you owe (like my house bought in 2006), thereby preventing you from refinancing at a lower interest rate(like me)
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You can’t. You agreed to the payments, and 6.75 is pretty good. If you have A+ credit and equity a bank might give you 5%.
Ask your present bank to streamline your loan. You may still have to pay PMI (I do not know I would never pay that) but they can lower your interest rate. It is sort of a free mini-refinance. I am doing mine now, even investment properties.
Even though they call it streamline a LOT of paper is involved, very similar to a new loan.
Your mortgage company likely won’t modify your loan b/c you haven’t had a change in income. If you can’t make it work through a broker, who can look in many places, a bank likely won’t work.
There’s really nothing you can do until you qualify to refinance, which you can’t with less than 80/20. You MAY be able to streamline, but there will likely be a requirement as far as equity goes.
A+ credit for most banks requires a score above 740. Some is 720 and up. Your interest rate will depend on your score, number of years to refi, income to debt ratio, etc. Since you do not have much equity in your home and assuming you have only been paying a short time, your options to reduce your monthly payment is to get a 30 year at 4.5%, maybe lower. It might be best to refi and roll some of your credit card debt into your new mortgage so you can get rid of the bills and at last get a small tax deduction.
You can’t. You don’t even have hardship, and the closing costs of refinancing would almost certainly exceed the amount you’d save.