Advice on Refinance For More Than 100% LTV
- Learn the basics of calculating an LTV.
- Discover your options if you are underwater.
- Look into FHA options.
How to Refinance if Your Mortgage Balance is Greater Than the Value of Your House
You face an uphill climb in finding a refinance loan if your mortgage balance is greater than the value of your home. Most lenders will not offer you a loan for more than 100% of the value of you property. (Editor’s Note: President Obama announced changes to the Home Affordable Refinance Program (HARP) that will help millions of underwater homeowners refinance at today’s low rates. If your loan is owned or insured by Fannie Mae or Freddie Mac, you can get a HARP mortgage, no matter how fall the value of your home has fallen. The program will go into effect in late 2011.)
Before we discuss your options, let us pause for a moment to define two terms some Bills.com readers misunderstand. Mortgage lenders, like other professionals, use acronyms and jargon to express specific ideas. In the mortgage world, the relationship between the loan amount and the value of the property is known as the Loan to Value, or LTV. For example, if your loan is for $80,000 on a $100,000 home, your loan-to-value would be 80,000 divided by 100,000 or 80%. Mortgage experts would say, "The LTV on this property is 80%." Equity is another other way to express this idea. In this example, the homeowner has 20% equity in the home, or $20,000 of equity value.
Here is the bad news: Generally speaking, private lenders do not refinance when the LTV is greater than 80%. The good news: You may qualify for an FHA-backed refinance if your LTV is between 80 and 96.5%. If your LTV is above 100%, then you may qualify for an FHA Short Refinance. Refinancing when an LTV is greater than 100% is known as an underwater refinance. Government programs will allow homeowners to refinance a 120 percent mortgage.
Another alternative is the Home Affordable Refinance Program.
The only way to determine if you qualify for a refinance loan is to apply for a loan with several different lenders or brokers. Bills.com makes it easy to compare mortgage offers and different loan types. Visit the Bills.com refinance page and find a loan that meets your needs.
Not only will these mortgage professionals tell you whether you qualify, but if you do not qualify, they can tell you what aspects of your financial situation are causing you problems, and make suggestions about how to improve your chances of qualifying for a loan. If you would like to read more about mortgage refinance loans, I encourage you to visit the Bills.com Home Refinance Resources page.
Get a Rate Quote
- Refinance Now | Take Advantage of Low Mortgage Rates
- Bad Credit Mortgage Refinancing | Prepare Before Shopping
- Best Refinance Rates | Bills.com: Find. Learn. Save.
- Obama Refinance Plan
- HARP 2.0 Mortgage Refinance Loans | HARP Program Updates
- Cash-Out Refinance
- Government refinance
- Good Time to Refinance
- Home Refinance Options
- Buy a Home with an FHA loan
- Bank of America Refinance
- Debt Consolidation
- Refinance My Home
- US Bank No Closing Cost Refinance
- Debt Relief
- Fifth Third Bank Mortgage
- Washington Mutual
- Government Debt Relief
- US Bank Home Mortgage
- HSBC Mortgage
- Bank of America Mortgage
- Debt to Income Ratio
- Credit Counseling
- Chase Mortgage
- Consolidate Debt
- Chase Mortgage Refinance Tips
- Guide to Refinance
- HARP 2.0 Mortgage Rates
- Refinance Upside Down
- Mortgage Rate Predictions
- refinance first and second mortgages
- Quitclaim Deed and Divorce
- Should I Refinance My Home?
- Upside Down Refinance
- Chase Mortgage Refinance Tips
- Refinance With 118% LTV
- Assumable Mortgage & Estate
- Mortgage Analysis
- Electronic Signature on Refinance
- Refinance with Chase or M&T Bank
- Refinance $200,000 Mortgage
- Note v. Mortgage
- Refinance 4-Unit Apartment
- Refinance Mortgage or HELOC?
- Use Retirement Funds to Refinance
- Title Insurance for Refinance
- Refinance or Not
- Refinance Debt
- Refinancing with Bad Credit
Search answers to other readers' questions, or ask your own and get a personal answer!
Learn how much you can save over time by cutting back on your daily latte or other small expenses that add up!
Consolidation? Credit counseling? Debt settlement? Bankruptcy? New loans? Debt Coach, a free online tool, gives tailored advice to help you find the right solution for your needs.
Use our Debt Consolidation Calculator to learn how much your loans actually cost, and to find solutions to save money!
How savvy are you about your personal finances? Take this quick quiz to learn insights into your finance habits and your Bills IQ.
Deciding if a mortgage refinance loan is right for you? Our calculators make it easy. Plug a few key facts about your old loan into our calculator, and learn if a refinance makes sense for you.
See today's national averages for adjustable and fixed-rate mortgages. Then drill-down to learn what is the best rate for you!
Learn what your fellow Bills.com readers think about financial solutions providers and mortgage lenders. We want you to share your experiences, too!
If you want to dive deep into your debt relief options, including the costs of each solution, read these whitepapers. Includes references, so you can follow-up on each fact cited.
Bills.com experts explain, in fast-paced videos, the basics of refinance, debt relief, student loans, and more.
Tool Box Easy to use resources to help you find solutions to your money questions