January 28, 2008

To save my home from foreclosure in Jan. 07 I refinanced at 10%, 40 year and a 5% pre-payment penalty. Should I refi now at 6%, 30 yr or wait 2yrs?

I am now making all my payments on time and would save $ 400 a mont on my house payment. I am in my late 50's, retired on a fixed disability income. I live in the PNW where home prices are still on the rise. If I do this refin it would add another 20k to my mortgage. My house is valued at 400k. I presently owe 240k. What should I do? Help!!!!

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January 28, 2008

Posted by Naomi

5 stars ( 1 rating )

I gather that the reason for forclousure was because not enough income since you are on a fixed disability income. By refinancing your payments will be $400. a month less. That will give you more breathing room to pay your bills. I take you are planning on staying in your home for the long term correct?. I would take advantage of the low rate at 6% for 30 years fixed. Make sure is a fixed morgage. Also make sure you know what you are signing and that you have your lawyer there explaining everything to you. Good Luck

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Victoria88: The reason my home was in foreclosure was because I had not started receiving my disabilityy yet. Couldn't work no money. I would have to pay 12,000 in pre-payment penalty plus closing cost adding 20k to my principle. Would the refi still be good in the long term. Seems like it would take almost 4 years to recoup. Still good to refi?

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To save my home from foreclosure in Jan. 07 I refinanced at 10%, 40 year and a 5% pre-payment penalty. Should I refi now at 6%, 30 yr or wait 2yrs?

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