Someone explain to me why we can't refi our loans anytime we want?

[wutamess]

If we already owe the money and have been paying our bills on time each and every month why can't we refinance the current loan to a lower interest rate without getting:

1. Appraisals & our homes to be worth as much?
2. Closing costs, etc?

It just doesn't make sense.
Isn't that the nutshell of Obama's foreclosure plan?

[Rain Man]

Don't get me started on appraisals. Biggest scam on the face of the planet. If I ever get elected to public office, the first thing I'm going to do is kill the appraisal industry's role in refinancing.

[wutamess]

Don't get me started on appraisals. Biggest scam on the face of the planet. If I ever get elected to public office, the first thing I'm going to do is kill the appraisal industry's role in refinancing.

Well it should probably be needed in financing but not REFINANCING what you currently owe. It just doesn't make sense

[Rain Man]

Well it should probably be needed in financing but not REFINANCING what you currently owe. It just doesn't make sense


I could theoretically see that the need would be equal for both, because you could be running debt up on the house or the value could be going down. But jeez, go to the county assessor web site and only do an appraisal if the numbers don't fly using the county appraisal. It takes two minutes.

The lousy appraisal firm on my house didn't even use proper records. They were using ten year old Realtor listings that were incorrect, and when I informed them of it, they said, "All we're doing is confirming that the house exists. The numbers are meaningless." If that's the goal, then type the address into Google Earth.

Biggest scam on the face of the planet. Nigerians wistfully aspire to be one-tenth as successful as appraisal firms in stealing money from the American public.

[Garcia Bronco]

Don't get me started on appraisals. Biggest scam on the face of the planet. If I ever get elected to public office, the first thing I'm going to do is kill the appraisal industry's role in refinancing.

How do we determine property worth at that point? Just go on the county, city, or state assessment?

[wutamess]

I could theoretically see that the need would be equal for both, because you could be running debt up on the house or the value could be going down.

Even if you have run up debt on the house, that still doesn't justify the need for an appraisal to refinance what you already owe.

[HonestChieffan]

You can't cause thats how it is. If you pay on time and have been a stand up guy, then you are not part of the stimulus. You are the Hosee, not the hoser. Welcome to the next 4 years.

Plan your vote now for the next congrssional election and throw out every incumbant. Its as bad to vote yes on something you didnt read as it is to vote no on something you didnt read.

sweep the corners

[Rain Man]

How do we determine property worth at that point? Just go on the county, city, or state assessment?


For refinancing, just use the county assessor. I've got 50 percent equity in my house. Even if the county assessor is waaaaaaay off, that two-minute web site visit should be sufficient for me to get a refinance.

If it's close, then get an appraisal, but I think all they do is look at the county web site and pick a number that's close.

The guy who lost AN ENTIRE FLOOR of my house in my recent refinance had to go back and redo his appraisal. He started out $20,000 below the county's assessed appraisal, and by adding 700 square feet that he missed because he was using incorrect records, he somehow ended up $20,000 above the county's assessed appraisal. His value of my house at 2 stories was something like $250 per square foot, and then when he had to redo it to account for the missing third floor, somehow the value went down to $210 per square foot so that it would still end up near the county's figure. Apparently that extra 700 square feet had a value of $60 per square foot whereas the rest of the house was worth $250.

It basically proved to me that they weren't doing an independent appraisal.

[King_Chief_Fan]

You can't cause thats how it is. If you pay on time and have been a stand up guy, then you are not part of the stimulus. You are the Hosee, not the hoser. Welcome to the next 4 years.

Plan your vote now for the next congrssional election and throw out every incumbant. Its as bad to vote yes on something you didnt read as it is to vote no on something you didnt read.

sweep the corners
rep

[Fat Elvis]

For refinancing, just use the county assessor. I've got 50 percent equity in my house. Even if the county assessor is waaaaaaay off, that two-minute web site visit should be sufficient for me to get a refinance.

If it's close, then get an appraisal, but I think all they do is look at the county web site and pick a number that's close.

The guy who lost AN ENTIRE FLOOR of my house in my recent refinance had to go back and redo his appraisal. He started out $20,000 below the county's assessed appraisal, and by adding 700 square feet that he missed because he was using incorrect records, he somehow ended up $20,000 above the county's assessed appraisal. His value of my house at 2 stories was something like $250 per square foot, and then when he had to redo it to account for the missing third floor, somehow the value went down to $210 per square foot so that it would still end up near the county's figure. Apparently that extra 700 square feet had a value of $60 per square foot whereas the rest of the house was worth $250.

It basically proved to me that they weren't doing an independent appraisal.



Nice house with lots of equity.....(based on the numbers you've provided).

[Simplex3]

The person loaning you money wants to be sure the home is still worth what it was. What if you've gutted the place and sold all the wiring? If the home itself wasn't the collateral then they wouldn't need to appraise the home.

Also, the government's appraisal of my house is dumb. They haven't stepped foot in my house since it was built more than ten years ago, yet they know what it is worth.

[Garcia Bronco]

Nice house with lots of equity.....(based on the numbers you've provided).

His house has been on tour. Speaking of Kevin, you gonna do a draft day thing this year again. I would like to attend this time if you do.

[wutamess]

The person loaning you money wants to be sure the home is still worth what it was. What if you've gutted the place and sold all the wiring? If the home itself wasn't the collateral then they wouldn't need to appraise the home.

If that's the case... You're ALREADY paying (on time) for a bare bones place. Why the need for an appraisal just to reduce your interest rate?

[HonestChieffan]

If the place has fallen far enough, the bank needs to know so they keep an adequate debt to equity ratio...the risk to you is they may not want to refi you and then you have to look elsewhere

[Rain Man]

Nice house with lots of equity.....(based on the numbers you've provided).


Well, I like it. It took 11 years to get it completely rehabbed, but it's done now and we really enjoy living in it.

And after 14 years of payments, I still owe $80,000 more than I bought the house for. :shake:

[Rain Man]

His house has been on tour. Speaking of Kevin, you gonna do a draft day thing this year again. I would like to attend this time if you do.

Y'know, I should do that. Let me arrange it and see if others are interested.

You still living in Capitol Hill?

[jAZ]

If we already owe the money and have been paying our bills on time each and every month why can't we refinance the current loan to a lower interest rate without getting:

1. Appraisals & our homes to be worth as much?
2. Closing costs, etc?

It just doesn't make sense.
Because refinancing good loans that are being paid at higher interest rates is not something that the lender want to do. Why would they make that easy on their own?

I'd love to lower my interest rate with a phone call. But that's bad business.

[jAZ]

If that's the case... You're ALREADY paying (on time) for a bare bones place. Why the need for an appraisal just to reduce your interest rate?

They don't want their profitable loans becoming to less profitable ones.

[wutamess]

If the place has fallen far enough, the bank needs to know so they keep an adequate debt to equity ratio...the risk to you is they may not want to refi you and then you have to look elsewhere

That still doesn't explain how there is a risk if it's through the same bank and you've been paying the HIGHER payments (on time) since the inception of the loan.

Why all the red tape if all you're doing is lowering your interest rate?

[wutamess]

Because refinancing good loans that are being paid at higher interest rates is not something that the lender want to do. Why would they make that easy on their own?

I'd love to lower my interest rate with a phone call. But that's bad business.

I get that point but, we have to go through all of that just to get a refi?
And why is everyone so upset at Obama for making it easier for good loanee's to refinance?

[jAZ]

I get that point but, we have to go through all of that just to get a refi?

I don't know that there is a whole lot more to it than that.
And why is everyone so upset at Obama for making it easier for good loanee's to refinance?
I also don't think there is much opposition to the plan, really. The echo chamber makes things sound louder than they are.

See:
http://www.chiefsplanet.com/BB/showthread.php?t=202955

[petegz28]

That still doesn't explain how there is a risk if it's through the same bank and you've been paying the HIGHER payments (on time) since the inception of the loan.

Why all the red tape if all you're doing is lowering your interest rate?

Roger, if you have a good lender they will refi you cause that is how they make their money. jAZ I think is off-base on this. They do have to go through the red-tape cause you are essentially having to re-qualify for the new loan. But that should not prevent them from lending. In fact when I re-fied I didn't have to have another appraisal but we still had to produce all the documentation.

They want you to refi because it puts you bac into the poistion of your payments being more interest than principle. The longer you stay in your current loand the more the payment goes to principle. So if they refi you they start you all over again and that is to their benefit.

[wutamess]

They want you to refi because it puts you bac into the poistion of your payments being more interest than principle. The longer you stay in your current loand the more the payment goes to principle. So if they refi you they start you all over again and that is to their benefit.

Unless you do a remaining term loan, right?

[Calcountry]

The person loaning you money wants to be sure the home is still worth what it was. What if you've gutted the place and sold all the wiring? If the home itself wasn't the collateral then they wouldn't need to appraise the home.

Also, the government's appraisal of my house is dumb. They haven't stepped foot in my house since it was built more than ten years ago, yet they know what it is worth.Heh, what do you think all these fools have been doing to these homes BEFORE they walk away?

[jAZ]

Roger, if you have a good lender they will refi you cause that is how they make their money. jAZ I think is off-base on this. They do have to go through the red-tape cause you are essentially having to re-qualify for the new loan. But that should not prevent them from lending. In fact when I re-fied I didn't have to have another appraisal but we still had to produce all the documentation.

They want you to refi because it puts you bac into the poistion of your payments being more interest than principle. The longer you stay in your current loand the more the payment goes to principle. So if they refi you they start you all over again and that is to their benefit.

That's true and a good point. However, like the casinos, they don't want that movement all in one direction (toward downward interest rates) without some mitigation. They want to avoid the dynamic that puts artificial downward pressure on interest rates. And so in order to push back against that, they put in obstacles.

The main one, of course, is fees that will more than cover their refi costs on their end. They will extend your break-even point and discourage you from jumping on the lower rate bandwagon.

[Garcia Bronco]

Y'know, I should do that. Let me arrange it and see if others are interested.

You still living in Capitol Hill?

South East Denver off of Parker.

[petegz28]

Unless you do a remaining term loan, right?

I don't know what you mean by a reamining term loan?

[wutamess]

I don't know what you mean by a reamining term loan?

Basically, lowering the interest rate on your current loan.
On my blog... someone posted a comment about that type of loan.
they do exist don't they?

read comment after the blog posting:
http://www.rapiddebtloss.com/blog/2009/02/17/thinking-twice-before-refinancing-home-or-car/

[petegz28]

Basically, lowering the interest rate on your current loan.
On my blog... someone posted a comment about that type of loan.
they do exist don't they?

read comment after the blog posting:
http://www.rapiddebtloss.com/blog/2009/02/17/thinking-twice-before-refinancing-home-or-car/


Ah, now that I am not familiar with. They lenders probably don't like that idea. I was talking about refinancing. You are talking about re-negotiating the interest rate.

[wutamess]

Ah, now that I am not familiar with. They lenders probably don't like that idea. I was talking about refinancing. You are talking about re-negotiating the interest rate.

Well I guess if that's what you want to call it.

[petegz28]

Well I guess if that's what you want to call it.

Well that is what it sounds like it is to me. You want to keep the same mortgage but reduce the interest rate. I don't see the lenders jumping at that one. A re-fi, yes.....not sure about this though. Then again, if the other option is the lender has to foreclose on the property it could be in their interest given the current real estate climate.

[WilliamTheIrish]

Don't get me started on appraisals. Biggest scam on the face of the planet. If I ever get elected to public office, the first thing I'm going to do is kill the appraisal industry's role in refinancing.

Amen. The slightly smaller scam is when they sit you down at the table during closing with a stack of papers as this as the NYC Yellow Pages and say :

"This paper (paper? It's a dossier!)just means you promise to repay the loan. And this paper (another 14 page document with legaleze) means the title is insured. (against what? - squatters?):. When I started asking questions and then asked for a calculator, they got even more anxious (we have other closings, sir!) and ran me through a like a Tyson chicken.

I went in for my first home closing and came out of there feeling like I had nothing left but my shorts.

On the second home closing, I had a lawyer and when I started asking questions and they tried the strong arm again, my guy stood up and said: "Until each question is answered to our satisfaction, there will be no closing. You can either cooperate, or you can recalculate all these numbers for another day in the month".

They asked who he was. He told them he was a real estate attorney hired by me to look out for my best interest. They got very chummy after that.

[wutamess]

On the second home closing, I had a lawyer and when I started asking questions and they tried the strong arm again, my guy stood up and said: "Until each question is answered to our satisfaction, there will be no closing. You can either cooperate, or you can recalculate all these numbers for another day in the month".

They asked who he was. He told them he was a real estate attorney hired by me to look out for my best interest. They got very chummy after that.

Did anything actually change by him being there?

[HonestChieffan]

Buyers bank account went down...