Mortgage Refinance

[Deleted]

When we bought our house four and a half years ago we put the mortgage in just my husbands name. My credit was not good at the time. We only put 3 1/2% down and have an FHA loan. Our property value has gone up significantly since we purchased and we are thinking about refinancing to get rid of PMI. I believe that our interest rate is around 4% right now. We would like to refinance into both of our names, is that even something that can be done? We currently have approximately $40,000 in consumer debt that we are on track to pay off in the next 36 months. Freeing up the monies from the PMI would enable us to put more money towards our debt. Is this something that you would recommend doing and Is it even possible or would we have to refinance in his name only

[tealblue]

Dec 19, 2019 16:29:17 GMT -5 @sameoldstory said:

When we bought our house four and a half years ago we put the mortgage in just my husbands name. My credit was not good at the time. We only put 3 1/2% down and have an FHA loan. Our property value has gone up significantly since we purchased and we are thinking about refinancing to get rid of PMI. I believe that our interest rate is around 4% right now. We would like to refinance into both of our names, is that even something that can be done? We currently have approximately $40,000 in consumer debt that we are on track to pay off in the next 36 months. Freeing up the monies from the PMI would enable us to put more money towards our debt. Is this something that you would recommend doing and Is it even possible or would we have to refinance in his name only

You can refinance in one or both of your names. There’s no requirement to keep the mortgage in only his name.

I just refinanced with Chase mortgage, and felt like they had the cheapest rates and lowest fees from the other lenders I talked to.

[clairebear]

Yes, you can refinance in both names. Get with a mortgage broker and see what kind of rates and terms you can qualify for. You pay fair amount in closing costs so you want to make sure the money you will save outweighs the cost to refi. You also want to try and keep your term the same...ie not refinance back into a 30 year mortgage and lost all the time you've spent paying on the mortgage. Also, ask the lender if it's enough to count on only market appreciation. I do appraisals and see a lot of lenders require that improvements be done on the home to increase value instead of just market value appreciation. Not sure how many lenders do this though. 

[dr.girlfriend]

Was the deed in both your names? Just wondering...when we bought our house (and I think every time we refinanced) the mortgage was in my name only but both our names are on the deed. It works for us.

[Susie]

If both of your names are on the deed, then sure, you can refi with both partners' names on the mortgage.

If only his name is on the deed, the answer is probably no because you would not have an ownership interest in the property, so you would not be able to offer it up as collateral for the loan.

[madisen]

Dec 20, 2019 11:50:52 GMT -5 Susie said:

If both of your names are on the deed, then sure, you can refi with both partners' names on the mortgage.

If only his name is on the deed, the answer is probably no because you would not have an ownership interest in the property, so you would not be able to offer it up as collateral for the loan.

This isn't true for standard FNMA/FHLMC/GNMA loans. The home is collateral for the loan regardless. You don't have to be on title to be on a mortgage loan. It's not a smart thing to be on a mortgage loan but not on title, but it's allowed from a guideline perspective. Banks will still come after you for the difference if you default based on your other assets/income.

However, refinancing is a perfect opportunity to add OP on title if she's not already on it and to do it with the process of refinancing instead of having to deal with it outside of it.

[madisen]

As far as the comment about needing improvements rather than just current market valuation. Improvements aren't a requirement if your goals (getting rid of PMI/MIP) are met with current market valuation on a refinance. That's just a straight Loan to Value calculation and if you're refinancing into a Conventional loan, being at or below 80% LTV. PMI is not required at or below 80% LTV on FNMA/FHLMC loans.

For seeing if a refinance is worth it, I recommend the mortgage calculaters on dinkytown.com.

And for rate shopping, I always recommend bankrate.com.

[jlt19]

Dec 19, 2019 20:50:39 GMT -5 dr.girlfriend said:

Was the deed in both your names? Just wondering...when we bought our house (and I think every time we refinanced) the mortgage was in my name only but both our names are on the deed. It works for us.

We have ours like this too. Originally it was because DHs credit wasn't great. But then when 2008 happened and both of our jobs were in jeopardy as well as our home value tanking, it actually made me feel better. Because that meant if we had to walk away, at least only my credit would have been affected.

I mean, not really something to plan for, but it's a risk management tool I've been comfortable with. We honestly don't have any shared debt for credit purposes.