Home Sale Relief

Standards have changed if you are thinking of getting a new loan to refinance. It is much harder than it was.

For one thing, if your FICO score is 680 or less, it is very hard to refinance unless you have at least 20% or more in equity.

Also, if you have excellent credit, buying or refinancing without equity is harder. And it costs a lot more. As reported today Fannie Mae increased fees for new mortgages, which will be passed on to you.

As Tom writes:

It looks like the cost of lending is starting to be felt by the consumers as the lending institutions try to reclaim some of their losses. Smart business and the consumer will not notice too much if rates continue to drop. It will make it harder for originators as they will have another fee to work into their loan package.

Another report shows that non-government-guaranteed rates are still higher than they have been. As interest rates have fallen, the mortgage rates on jumbo mortgages are still relatively high.

I will remind you that we have gotten used to fairly low rates in recent years. When I did my first mortgage in 1987 it was 10.3% which wasn’t considered too bad. Historically rates are in the low end of things.

All it amounts to is that your refinancing options are very limited. I would suggest instead that you consider getting your mortgage lender to lower your payments without refinancing. Stated income refinancing foreclosure issues are going to get worse. The other alternative is doing a short sale.

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