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Can a home that is underwater be refinanced for the current market value?

We bought our home in 2005 for about 162. It's worth about 110 now, but we owe about 150. We would love to move to a bigger house, but I'm not sure we can, being so upside down...
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February 09 - Aurora
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No the house has to appraise for the value 
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May 08
As mentioned below you can engage a good mortgage buy and see if you can qualify for a HARP refinance loan. I personally was able to do this with a property I was underwater on (I was in a similar situation as you) in the Edgewater neighborhood of Chicago. From experience I am answering yes to your question. Feel free to contact me should you wish to discuss further.
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March 02
If you're asking can you get rid of $40k in debt, the answer is no. If you are eligible for HARP, FHA streamline, or VA IRRRL, you can potentially refinance into a lower rate, but you will still owe $150k. If you are not eligible, then you can look into a loan modification through your current lender as that would be your only option at lowering your payments. 

If you are considering walking away and short selling the home or letting it be foreclosed on, keep in mind you won't be able to purchase a new home right away and it can severely damage your credit. 
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February 11
You need to see if you're eligible for the HARP program. Use Barb's links below to check.

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February 11
No you cannot refi, but have a few agents do market comps to see if your value is correct. The market has changed/improved.
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February 10
You may be able to refinance the mortgage using the HARP program, if the loan is eligible. See links below to check.

However, that won't change the fact that it will be hard to sell and move on to a bigger home. If you sell, you will need to come up with significant cash at closing (assuming you have the value correct). Don't let a real estate agent tell you that you can do a short sale because you will trash your credit and won't be able to buy again for quite some time. Perhaps you can think about renting the home until the market improves? Or, if you have some funds available for a down payment now, there might be a way to rent the home and purchase another.

Check these sites for HARP refinance eligibility:
Fannie: https://knowyouroptions.com/loanlookup
Freddie: https://ww3.freddiemac.com/corporate/
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February 09
So are you asking if its possible to refinance the 150K loan into a lower rate  new 1150K loan  ??

the answer is   ...yes - its possible as long as your loan is eligible for the HARP  program


thanks
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February 09
I would suggest contacting a lender to see if you can refinance using a HARP loan. The HARP program allows you to refinance an underwater home loan if the loan is owned by Fannie Mae or Freddie Mac.
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February 09
No lender will give you a larger loan than the house is worth, they just won't do that. There would be an appraisal done and you might find it is not as under as you thought, or it might be. Good luck.
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February 09
 
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