Five Reasons Not to Refinance!
With rates hovering so low, if you haven’t refinanced by now, you are probably considering it. But a refi isn’t going to work for EVERYONE, so consider these points before forking over your cash to get one started.
1. EQUITY-If you have less than 10% equity in the home, the numbers may be too tight, and an appraisal coming in at the right number is certainly a concern. Do some research first before paying for an appraisal.
2. CREDIT SCORE- if your score is under 620, forget the refi. If your score is between 620-680, you would be looking at loan programs other than conventional, ie: FHA. You can have Denise Hoernke from Wisconsin Mortgage our in-house lender run a free report for you or check online before you start. Every consumer is allowed l free credit report per year from each of the big 3 reporting agencies. Click HERE for details on free reports.
3. NEWER OWNERS- if you have owned the home less than 5 years, again, the appraisal/value numbers would certainly be in question. Most likely your home is worth less than what you paid for it, just due to market conditions. Every market is different, check with your agent BEFORE calling the loan officer.
4. NEW CONSTRUCTION-if there is one place appraisals are really having a hard time these days, it is with new construction. If your home is only a few years old, an appraisal will be hard to get with the right numbers… Just like a homes replacement value is higher than the market value, the construction costs (including your landscaping and hardscapes) will be more than the market value.
5. UNDER 100K-If your loan balance is under $100,000, either due to the value of the home, or you’re in the home stretch of the repayment process, the cost of a refi may not make it worthwhile.
And what if you just did a refinance in the last few months, and you can still beat THAT rate? It depends on by how much….really do the math to be sure it is worthwhile. And the math includes the tax benefits of the interest deduction. The one plus of having just done a refi, is that the appraisal may be “fresh” enough to be used again, without the cost of a brand new one. Call your lender and ask.
Local loan officer,Denise Hoernke would be glad to help you analyze your particular situation, BEFORE you make the investment in a refinance.
Of course, if the stars and the moon are aligned, and refinancing is still in the picture for you, Denise will be happy to meet with you and get the process started. Or, even easier, you can apply directly online with her hyper-secure site.
Values in the city and suburbs of Greater Milwaukee really vary. If you are looking to sell and move up to take advantage of this buyers market, call me today. I can supply data showing you if it is the right time to make that move. Yes, you will suffer some on the selling side, but depending on the price area, you could well make it up many times over on the buying side!
Posted by: 
Pat Tasker
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Tagged with credit score |
As well as, how are they going to report the payoff? A short sale can reduce your credit score between 60-100 points, but there have been times when the short sale does not affect your credit score negatively at all. (A foreclosure would be a minimum of a 150 point deduction) This of course will depend on your specific situation. For example, a seller that has missed recent payments and is doing the short sale to avoid a foreclosure would take a bigger hit than the seller that is current on their mortgage, but property values have decreased so they are unable to sell the property for what they owe.
Each bank has their own requirements. The Kuchta’s - Kelly & Colleen are very familiar with the short sale process/foreclosure process and have helped many sellers, as well as buyers with their transaction. Feel free to contact us for a no obligation, consultation 262-894-6512, or 
Colleen Kuchta
