There are definitely some risks with this approach. What happens if the short sale doesn't work out for a price you like? Will you want to move again? Have you already found a home you have an offer on? You also take the risk of interest rates increasing while you wait for the short sale to be approved. You may want to get a home inspection prior to moving in so that you can negotiate repairs prior to moving in.... more
If you get an equity loan later on, part of the proceeds will be needed to pay off your current equity loan. No one does a third mortgage anymore.
You may want to consider refinancing with a 203K which would pay for improvements.... more
If you are a member of a local credit union, try those first. Otherwise find a reputable bank and ask for their help. Their are lots of good programs out there. Why not use your current banker that you mentioned in your question?... more
Hello Kelly, Contact Zach Larichiuta, Senior Loan Officer, with Shelter Mortgage, a branch of Guaranty Bank and Lending. You are interested in an "under water loan", where you owe more than the home is now worth. You must have closed on the home prior to May 2009 and have good credit. Zach is our "in house" lender at Carolina One, 873 Orleans Rd. Email Zach at Zach.Larichiuta@gbmail.com and see what he can do for you. No cost, nor obligation, of course. Good luck with your refinance. Imogene Thomas, Broker Assoc. with Carolina One. (843) 860-2247 firstname.lastname@example.org... more
It's tough to find 2nd mortgages on non-owner occupied properties, it's tough to find 2nd mortgages up to 100% of your home's value, to find a combination of both is near impossible in my opinion. When credit was at it's easiest, when income wasn't verified, etc. we saw 2nd mortgages on non-owner occupied properties to 100% of the home's value - but since then they dwindled down to about 50-70% of the home's value.
Unless you have the funds to bring in at closing, and take out a refinance for 75% of the home's value... if you are at about 99% of your home's value and you have an FHA mortgage, then a streamline FHA refinance is probably going to be one of the best refinance options, if not the best.
For others who are reading, it is possible to refinance a non-owner occupied loan which already has an FHA mortgage into a new FHA mortgage, certain guidelines apply.... more
You can't get an FHA then. If you go through a traditional lender you could see 20% to as high as 30% or even 50%! But if you shop around you should be able to get on the low side of that figure as long as all the other items such as credit check and likely cash flow and appraisal look good.... more
No knowing any of your financial details--visit with any qualified loan officer(s) see what your budget can handle and check your credit score--their scoring is different--Currently FHA loans do require a minimum credit score of 620 and 3.5% down--there may be lenders willing to work with a lesser score, however the interest rate may be higher. In the meantime continue working on repairing your credit--pay off old debt, pay down debt, dispute old negatives, pay all bills on time, keep credit cards below 50%, etc.... more
Karla, sounds like you're getting pretty serious about this move South! Yes, you absolutely should get prequalified. Most sellers require a prequalification letter with any offer. Prequalification will also let you know how much mortgage you can afford; then you can decide how much you really want to spend on a second home. The rest of your question has two parts, so let me give you some brief answers to them both.
1) "it's better to print your credit report and take it to lenders" -- A reputable lender is not going to give you a prequalification letter based upon a printout that you bring them. What the website is trying to warn you about is going to many different lenders and having your credit report pulled. This will reflect negatively in your credit score.
2) "it's better to deal with lenders in the area we are planning to buy, due to state lending/insurance specifics" -- There are many lenders who service loans nationwide, and many lenders can do loans in any state. If you currently have a good relationship with a lender you trust, check with them first to see if they do loans in the area you are interested in. Once you decide upon an area, also check with your Realtor about reputable local mortgage lenders, and talk with a couple of them as well. If possible, get a Good Faith Estimate of costs and monthly payments, and use that as a comparison for different lenders. Narrow your selection to a couple of lenders, then talk with them and make your decision.
I can refer you to a very knowledgable mortgage broker in the Charleston area, if that's where you decide to locate. I'll be glad to answer any other questions you have about buying a second home and relocating, as well, Karla.
Best of success to you and your family as you move forward with this decision.
Teresa Cooper, CPA, Realtor
Virtually all investment properties require a 80% loan to value. in this market i do not know any banks that will do any less. some have even gone to 70% ltv. your best bet is to check with a mortgage company rather than a bank to see if they have anyone they work with that can do it. stay away from the internet lenders though. use local and trusted companies. good luck... more