NBR: ? about refinancing

babygroves

When you refinance do you go off what you bought the house for or is it based off what the value of the house is currently?

vanillacourage

It's basically a new mortgage process, so your lender would send out an appraiser just like when you bought it the first time.

SarahTx5701

current appraised value

krismtg

the value of the house currently 

babygroves

OK. That's what I thought. So we bought our house for 380,000 but in todays market it is probably in the low 300,000 now. Yikes, I know! So if they say it is worth 320,000 and we paid 380,000 what would happen? Does that make sense?

babygroves

Would it be worth it to think about refinancing?

tonysbride2b

Unfortunately you're not going to find too many lenders willing to do a refinance on a home that is worth less than is owed.  Give it a few months and see where things are then, GL!

babygroves

OK. Well luckily we got into a locked interest rate loan.

missamy713

We just refinanced our house two months ago.  Luckily we'd shopped around for awhile to get a good deal on a house, so we bought it under what it appraised for two years ago.

 I believe that your situation is one that a lot of people are facing today.  You won't be able to refinance unless you can come up with the difference, so in your case you'd have to come up with whatever you still owe above the appraised value.  So let's say you've paid your loan down to 350,000, and they appraised your house at 320,000.  Then you'd have to come up with 30,000 plus whatever the closing costs are for the loan.  At least that's how I understood it when we were refinancing.  

I'm sure there's someone else on here that's more informed on home loans than myself though.  Good luck.

babygroves

Missamy- I think you are right.