refinancing a house that’s lost value?
by Mortgage Rates on Wednesday, October 6th, 2010 | 3 Comments
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What is the current value compared to your loan balance? That is the critical question.
The drop in the value of your home will be problematic. Your best bet will be to pay down the debt as much and as quickly as possible. If you can invest the money at a higher rate than your mortgage, invest there. If not, then pay down the mortgage by having more go to pay down principal until you owe less than what your place is worth.
Possibly. You left out several critical details. Like your mortgage balance and current market value. Also, your credit history – what is your FICO score? What is the current rate on your loan, and is it worth the time and expense to pursue the refi?
Check your source on interest rate direction carefully. Rates are rising now, and have come up quite a bit in the last few weeks. Now well over 6% again.
If all else fails, your current lender may do a streamline refinance for you without an appraisal. This especially applies to a current FHA insured mortgage. If you need help with these questions, let me know.