Can you refinance the whole loan on an 80/20 original loan

AnnetteJennings
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Bought the house 8 years ago. Financed all with an 80/20 loan. The 80% loan is at a 6.5 and the 20% loan is at 8.5. Is it correct that I can only refinance the 80% loan? What can I do about the 20% since it is so high (I only only 13,000 on it and trying to pay it off as fast as I can....right now I see it paid off in three years but that is pushing it and for three years sacraficing every extra penny). I guess the 20% loan is considered a second mortgage and it cannot be refinanced under the HARP?????

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November 19 2011 - Lansing Township

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Answers (5)

Best Answer

Mark Gelbman, "Mark Gelbman"
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First, I am assuming that your home is worth less than it was when you bought it. You are correct in that there are no options concerning the 2nd mortgage. Under HARP, as long as your first mortgage is either a Fannie Mae or a Freddie Mac loan, you can refinance the first. With rates in the low 4s, I would say that now is the time to get it done, and you can use the savings to accelerate the paydown of the 2nd mortgage.

Feel free to email me so that I can create an analysis of your options.

Thanks,

Mark

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November 19 2011

Rebecca Vennesland, "BeckyVennesland"
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Hi Annette,

Have you received any help for your situation yet? If not, please email me. there are changes coming for the HARP program which will lift the 125% ceiling and this may affect your situation. Your 2nd mortgage lender will still need to agree to re-subordinate the 2nd mortgage so that they stay in the 2nd lien position. With the changes to the HARP program, the total loan to value of the 1st and 2nd mortgage together will be able to go over 125% with some lenders, if it is necessary due to the declining property values here in Michigan. We are a lender and not a broker. Lenders are not be required to participate in all of the changes to the HARP program, but we will be able to offer at least some of these changes to our mortgage clients once our investors have their guidelines in place. Our investors are already beginning to respond to us as to whether or not they are going to participate in the changes being made to the HARP program, but the new programs have not been rolled out yet. If I can help, please let me know.

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December 01 2011

Scott White, "LaxLoanPro"
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Loans on rental properties are usually going to require lower LTV's. Depending on how much you've paid down on this loan your only option may be paying the balance down to get to where your lender will allow. If it was a primary residence it would be a different story.