Author Topic: mortgage soloution  (Read 3313 times)

rtrnow

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mortgage soloution
« on: December 11, 2012, 07:48:15 AM »
So without going into details of why, I have a recent foreclosure on my credit. I have another property with a 120K mortgage currently at 5.8%. I'm kicking myself for not doing a refi before this hit my credit but that's too late now. I have no debt other than this mortgage. I also have about 60K cash which I plan to put totally toward the mortgage. Any reason not to do this? Anyone know a magic bank that would give a loan with a good rate considering the foreclosure if I had a large cash payment to put down?

trammatic

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Re: mortgage soloution
« Reply #1 on: December 11, 2012, 07:53:22 AM »
I'd try to find a local bank willing to manually underwrite you.  It's not terribly risky since you'll be at less than 50% LTV, so another foreclosure would likely result in a net win for the bank.

Another Reader

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Re: mortgage soloution
« Reply #2 on: December 11, 2012, 10:59:21 AM »
With a recent foreclosure, even a portfolio lender is not likely to do a loan.  If someone is willing, the interest rate will be high, probably higher than the current rate.  Also, $60k cash in puts the loan at under $100k, something a lot of lenders won't do.  If the property is not owner-occupied, your chances are even slimmer.  It might be worth making some calls to the local portfolio lenders and a couple of good brokers to get a feel for how long it will take to be eligible for decent rates and terms.

kudy

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Re: mortgage soloution
« Reply #3 on: December 11, 2012, 09:04:35 PM »
Lenders aren't usually willing to do < 100K loans? I didnt know that - do you know why? In a few years my home will have less than 100K balance on the mortgage.

gooki

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Re: mortgage soloution
« Reply #4 on: December 11, 2012, 09:19:02 PM »
Not enough profit in it for them.

rtrnow

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Re: mortgage soloution
« Reply #5 on: December 12, 2012, 07:24:40 AM »
Looks like it makes the most sense to just repay the loan as fast as possible and move on.

I've personally never run into the 100k issue. I know mortgage loans < 25K are usually not done. Maybe this has to do with what part of the country you're in. Here there are a lot of homes for <100K and I'm sure lots of people are getting mortgages on them.

Another Reader

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Re: mortgage soloution
« Reply #6 on: December 12, 2012, 07:30:22 AM »
If you are planning on keeping the property long term, I would certainly consider that.  The good news is that you will be able to buy an owner occupied property relatively quickly.  IIRC, it's three years after the foreclosure.  You might want to look into that to see if that would help with your long term goals.

rtrnow

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Re: mortgage soloution
« Reply #7 on: December 12, 2012, 08:44:42 AM »
I'm planning to own the property pretty long term. I kind of lucked out buying it. Although it has lost value, it's proved to be a great rental location and has been cash positive since I first started renting it. I've also heard rumors from a couple of different sources that there is interest from a large university next door in buying the property. So, I'm hoping that might be a bit of a windfall down the road.