Financing in 11367>Question Details

pazsint_maie…, Home Seller in Queens, NY

Is it possible to refinance my co-op loan with my existing loan company?

Asked by pazsint_maiellowedding, Queens, NY Thu Oct 6, 2011

I noticed they're advertising very low refinancing rates (I know co-op rates are slightly higher) and would love to refinance. I bought in March 2008. Purchase price $147,500, 10% down, 5.875%. Loan balance is now about $127,000.

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Annette Levinson’s answer
Shane, there is no mortgage tax on a co-op. HAMP does not do refinances on coops.
You should definitely call your current lender about refinancing. Coops have not lost as much value as SFR in Queens, so your LTV should be okay for your Board to sign the Aztec. Just don't be surprised when they don't know what a coop is. If they give you closing costs over $3,000 then you are definitely speaking to someone who doesn't know what a coop is. Also check with your managing agent to see if the coop would come to the closing. If they do find out what their charge is and where the closing must take place.
1 vote Thank Flag Link Sun Oct 9, 2011
When you are refinancing the appraised value of your home is often the biggest question mark, as you usually need equity in your home in order to refinance (or get a new lower loan amount and thus be willing to bring in money at closing of the refinance in order to create equity). Since you have a co-op, if you have at least 10% equity then refinancing should be possible with you only paying for closing costs out of pocket (none/some/all may be able to be financed depending on the appraised value). Refinancing in NY (particularly in the 5 Boroughs) has higher costs than in other states, so it usually takes a greater amount of savings in order to make refinancing worth it (the whole "initial cost vs. lower payments/savings over time" test). Evaluating that trade off is important when refinancing just for better terms (called a "rate & term" refinance).

Like Scott says, compare what your current lender can do vs. what a new lender can do. Your existing lender may be able to handle the CEMA process for a reduced cost (Google "CEMA mortgage" to find out more about CEMA if you don't know it), making them a better deal in terms of lower overall cost.

Even if you don't have 10% equity, if your loan is owned by Fannie Mae or Freddie Mac then it may still be possible to refinance (up to 125% of your home's value) using the Making Home Affordable Refinance programs. http://www.makinghomeaffordable.gov/get-assistance/loan-look… is the link to check if Fannie or Freddie own your mortgage.
1 vote Thank Flag Link Sun Oct 9, 2011
I am in the same position that you are. I have a Co OP in Laguna Woods and the lending company is HCB. They appear to have a monopoly on Laguna Woods Co Ops and their interest rate is 6.25% and they will not budge from this. I think we have an Anti Trust issue here. Sorry I can not be of help but be assured there are many co op owners in Laguna Woods with the same problem you have.
0 votes Thank Flag Link Mon Apr 30, 2012
Thank you for the information! :)
0 votes Thank Flag Link Mon Oct 10, 2011
Thanks for the info on the mortgage tax on the co-op, that is good to know. I've never financed one in NY.
0 votes Thank Flag Link Sun Oct 9, 2011
It could be possible, you need to ask them. you could also shop around and see what other banks are offering as well
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Thu Oct 6, 2011
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