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Can I Refinance If …

Some of the questions make us snicker but then we realize the reason most people are in bad shape is because they didn’t take time to ask basic questions when they were getting into a loan that would put them into bad shape. Here are a couple of answers to various “can I refinance if” type questions.

Can I refinance if I have been late on payments?

Maybe. It depends on what type of payments you have been late on, how long ago your last late payment was and what type of loan you are applying for. For example some lenders will allow you to do an FHA streamline refinance if you have been late on payments including mortgage payments and others will not (Novation allows FHA streamline refinances so long as the mortgage is current at the time of closing).

Can I refinance if my home is currently listed for sale?

No. But Novation will allow a refinance with the listing canceled and a good explanation why it was listed then canceled. We will not allow a cash-out but only rate and term on recently listed properties.

Can I refinance if I have had a foreclosure?

Maybe. It depends on how long ago the foreclosure was. It does not matter if the foreclosure was a primary residence, second home or investment property. As of today there are no conventional loans outside of the FHA streamline refinance which will allow a refinance to anyone who has had a foreclosure within the last 36 months as of the date of application.

Can I refinance from a non-FHA loan using an FHA streamline?

No. The FHA streamline is designed only for FHA loan to FHA loan refinance. You can still do an FHA refinance but not using the FHA streamline. One reason to do this would be to do a rate and term refinance up to 95% of the appraised value or a cash out refinance up to 85% of the appraised value.

Can I refinance if I have only been renting the home?

Not unless you have a true lease/purchase that was set up and recorded that way. Then it will actually be treated as a purchase rather than a refinance. The old practice of refinancing a property into the renters name from the owner’s name is gone. That was a sub-prime guideline that died with sub-prime loans.

Can I refinance if I lost my job?

The FHA streamline and Fannie DU Plus refinances only require employment verification or 1 year of tax returns for self-employed borrowers. If you are W2′d and we cannot verify employment you likely cannot refinance.

Can I refinance if I got a divorce?

If your former spouse is on the loan and on the title you will have to have a Quite Claim Deed and you will have to do a non-streamline refinance. You will have to qualify for the loan without your former spouse’s credit or income. You can use alimony and child support as supporting income provided there is a history of on-time payments and a future of realistic expectations you will continue to receive them.

If you are the type who likes to do all the research you can online before you start calling around let me remind you that (a) the mortgage banking industry changes every day – what was true today (April 9, 2009) may not be true even one day later (b) there are a dozen inexperienced loan officers in the business publishing information to every 1 who has 10 years or more of accurate experience (c) I have met people who claim to have decades of experience who are consistent in their errors. I belong to a group of professional mortgage bankers who spend much of our time critiquing each other and weighing one another against the truth. That helps guaranty our accuracy and honesty to you.

You can keep reading or you can pick up your phone and call me directly at 678-946-0101. We service the Georgia and Florida residential real estate markets and through my group of mortgage banking masters I am sure I can refer you to one of them if you are not in my area of practice or expertise.