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Refinancing

I have an outstanding debt. on my credit report, can I have the lender pay it off on the close of escrow?
  • July 28 - Brentwood
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Answers (3)

Refinances pretty much fall into one of two categories: cash out refinances or rate/term refinances. Most certainly in a cash out refinance and outstanding debt could be included in the loan proceeds (so long as you meet the stricter underwriting requirements especially loan to value limitations). A rate/term refinance, on the other hand, isn't designed to advance cash but typical guidelines allow up 2% of the loan amount of $2,000 whichever is less. That may just be enough to cover the debt in question. In addition, you should be able to skip at least one months payment as well as receive and escrow refund; all are possible sources of funds to payoff the outstanding debt. I hope this gives you a better picture of what is allowed under the various refinance scenarios.
  • July 28
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Yes that is a possibility if you are doing a debt consolidation/cash out refinance.  If it is a charge account or revolving debt most lenders will make you close the account completely.  They will wire the funds to the account or send a certified check.  Depends on the lender and escrow company.  I hope that answers your question.
  • July 28
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If you are doing a debt consolidation refinance then you can have the title company pay the debt off at the closing table. They will typically wire funds.
  • July 28
  • 0Yes

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