My husband bought our current home with a friend of his and they took out an 80/20 loan to avoid paying mortgage insurance. When my husband and I got married we bought out his friend's half of the loan and refinanced to get his name off and my name on the loan. We needed to come up with the closing costs and the equity the his friend made in the home (about $20,000), so we added onto the already existing 20% loan. Now we have our 80% fixed mortgage at about 220,000 and the 20% at about 70,000. We want to refinance both loans into one 30 yr. fixed rate mortgage to lower our monthly payment, but we do not know if this is possible or if it would help. Is this a viable option?

T. R.

Oakdale
Minnesota

Answer:

T., per your question on the Mortgage X website there are two primary variables that determine if it makes sense to refinance your existing mortgage at this time. These variables are as follows:

• What is your estimated current value of the property? Ideally your property will have a minimum of 10 to 20% equity in the property, which translates to an appraised value between $328k and $369k based on a $290k new loan size.
• What is the interest rate and terms of your current mortgages? For example if you have a 30 year fixed rate mortgage at 4.875%, then it may not make sense to refinance your mortgage but instead look at just refinancing your second trust.

Secondary questions will pertain to your income, credit scores, payment history, etc. But till you analyze the above two items it really doesn't make sense to look at your personal credit worthiness.

When you have a chance please respond to this email or call me at 866.552.5912. I look forward to talking with you soon.

Sincerely,

David Zuckerman
Your Mortgage Consultant For Life
Global Mortgage
6004 Woodbine Road
Woodbine, MD 21797
Phone: (410) 552-5912
Toll Free: (866) 552-5912
Fax: (410) 552-5942
E-Mail: david mymortgageauthority.com
Web: www.mymortgageauthority.com