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Should I refinance?

I bought a home three years ago at the interest rate 6.3%. Now the home value dopped a lot and my loan to value ratio is about 90%.I have to put in about $100,000  to be able to 80%. I have the money now and I just wondering should I do a refinance to my current house or use it to buy another house for investment.
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September 12 2010 - South Reno
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There are several programs that will not ding you for the higher LTV  The Making Homes Affordable programs is wonderful if your loan qualifies.  Contact your lender or a mortgage broker/banker to see if you can refinance under this program.
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September 13 2010
You can refinance using the Home Affordable program and the LTV shouldn't be an issue.  You would not need to bring any additional down.  If you are not paying monthly PMI now, you will not need to pay it with the new loan.

That is the best option for you.  It is significantly cheaper than doing an FHA refinance.

If you would like to discuss further, please feel free to contact me.  I am happy to help and get you ointed int he right direction.

Good luck!

Tim
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September 13 2010
Do you plan on staying in your current home for the next 4 to 5 years?  You will need to think about that.  In order amoritize your costs you need to keep your current property for about that amount of time.

By refinancing you will be lowering your payment.  This may qualify you to purchase another property.

Jo
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September 12 2010

I'm thinking outloud  -- what if you did an FHA refi on your current home to lower the interest and then used your money to purchase your investment home? 

Remember that your debt - to - income ratios would have to be good ... check that out to be sure your on the right track to begin with....

Good Luck --
Sincerely,
Celia
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September 12 2010
The saving from the refinancing is far better than if you buy the investment property right now.
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September 12 2010
In my opinion, first you should refinance your mortgage to bring down the monthly payment to qualify for another mortgage (if there is any money left for the down payment for the new investment), which also requires the Debt to Income ratio.
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September 12 2010
 
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