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refi a line of credit? long sorry
Posted this on the Money matters board also
My husband and I have made some poor money decisions and are currently trying to get it together. He was laid off for a year and half and we were living pay check to pay check but paying all our bills. We owed in taxes and that took the bulk of our savings. Then he got a much lower paying job and we wiped out the rest of our savings.
Our big thing is our morgage payment and this line of credit we had taken out years ago. We called BoA ~horrible people~ and tried to get the loan modification. they told us over and over they had everything and low and behold we got denied because they didn't have our paper work and wont return our phone calls. Then we went to our local bank and they were going to refi it all together and everything was going good and we were going to save $400 but then he said our house needed to appraise for $200,000. We are so not getting that.
The bank guy's suggestion was to refi our line of credit. We are getting 12% and our payment is $377 so about $65 is going to principle and it's killing us. Has anyone ever did this? do you have to have the house appraised for this as well?
sorry so long but thanks for your help
Re: refi a line of credit? long sorry
12% Do you have low FICO scores?
To refinance, your mortgage or HELOC you need to have the house appriased. You need equity above a certain % to have a HELOC at all.
When we got it our credit was good, then our credit went down with trying to make ends meet and we are slowly rebuilding our credit back up but if we were able to refi our mortgage and line of credit and we could have gotten 4.25%. The problem now is our house is abit under water and I just didn't know if we still needed an appriasal for refi the line of credit. So it sounds like we won't be able to do that either.
Thanks for your response!
You may also be limited in your LTV. Have you had more that 1k in cumulative draws from your line of credit in the last year? If so, you are going to be capped at either 80% LTV on a conventional loan, or 85% LTV on an FHA loan (instead of the 97.75% for a rate/term refi).
The only way to know your options is to have an appraisal done and weigh options with your loan officer.
We haven't taken any draws. We just pay it back. Thanks for your help. We got some water damage and have to replace our rug and a cracked window, we couldn't even get an appraisal now if we wanted to. Hopefully the market will get better.