Ask Kate How to Refinance Your Mortgage

by June from New Jersey, Edgar K from Florida, and more

Ask Kate how to refinance your mortgage: Hi Kate, Have you ever heard of a mortgage lender making this a requirement of applying for a refinance? He is telling me his lender says I have to sign over the deed so it is in only his name and take the house off the market before they can start the loan process.



First comes the divorce, then the refinancing home mortgage proposal... My ex-spouse has the option to buy out my interest in the home and refinance the existing mortgage. In the meantime, the house is for sale on the market. I have requested proof of funds and a pre-qualification letter from him and he has not provided those. I am not going to sign over the deed to him as then I will have relinquished my interest in the property and still be on the current mortgage. Remaining Anonymous

Ask Kate Empowering Homeowners - Your Home Your Mortgage
Ask Kate & the refinance proposal: If the lender requires you to sign your name off the deed yet remain on the mortgage, I assume their liability insurance is well-funded. As much as I dislike having to say this, I'd run this past your attorney since the terms of property ownership were most likely addressed in your divorce decree.

Many homeowners might not realize it is POSSIBLE to sell your house yet remain obligated on the mortgage. What a deal that is NOT.



Refinancing 5 family building and mortgage companies... Hi, am in the process of refinancing my 5 family building in New York. Do you recommend I use a lawyer for this? The bank just send me a commitment letter to sign and is getting ready to set up the closing real soon. June from Elmwood Park, New Jersey

Ask Kate at Get-Your-Best-Mortgage-Rate.com
Ask Kate & the watch dog: Well, June, I can tell you this. The bank is NOT going to look out for you. Their interests are front and center. Unless you are feeling terribly trusting, make sure a professional is looking out for you.

Go here for more details: Escrow - The preferred watchdog for closing your mortgage refinance. (I know I often revert to saying "escrow" vs "closing attorney" - It's just that I've lived west of the Mississippi most of my life where escrow is more common.)



Home refi rates: Should I refinance now or gamble on my 5:1 arm that is set to re-adjust in October? Hello, recently I contacted my bank to see if I can refinance. I was qualified and they were quick to send me a good faith estimate as well as the refinance documents. Currently I'm on a 5:1 ARM set to readjust this October on a home in Florida. The proposed refi is a 30 year fixed loan. Should I tough it out and save on the refinancing cost and keep hopes that I could get a better rate when my arm re-adjusts? Or should I play it safe and refinance now? Thank you for your professional advice. Edgar K from Tampa, Florida

Ask Kate Empowering Homeowners - Your Home Your Mortgage
Ask Kate on home refi rates & crystal ball predictions: My crystal ball cracked right along side the collapse of the economy. So I can't tell you if mortgage rates are going up or down. (It sure would be fun if I could though.) In lieu of a forecast, ask yourself if you have the luxury of affording a higher payment. If you'd lose your house over a spike in mortgage rates, consider the refinance carefully.

Secondly, call your lender and ask if today were October, what interest rate would determine your new house payment, what would your principal balance be, and how many months would remain on the term. Then ask the lender to calculate your mortgage payment. Anything can change between now and then, but I believe getting this information is worthwhile.

To double-check your lender's mortgage payment calculations, go to my Mortgage Rate Calculator and have at it. Cool!



Mortgage refinancing with bad credit... I got divorced and remarried. My home is still financed with my ex-husband and myself, and I have plenty of equity. Due to divorce circumstances, my credit is poor. I want to refinance the house and include my long term debt. We have good income and job stability - just having trouble getting our credit back on track. Can we see about finding a loan now or do I have to wait until we get credit cards paid off and house caught up? Remaining Anonymous

Ask Kate at Get-Your-Best-Mortgage-Rate.com
Ask Kate's tips for mortgage refinancing with bad credit: If you feel like you are caught between a rock and a hard place, it's because you are! Refinancing your mortgage to pay off debt would eventually improve your credit. Yet getting qualified for a refinance might be difficult due to bad credit.

I would try a two-pronged attack. Work on fixing the problem of bad credit the old-fashioned way but first talk with your lender about refinancing your mortgage. You won't know what refinance options are available to you today unless you ask. Start here before applying to refinance your mortgage with cash out.

Best wishes,

Ask Kate

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