Should I refinance or not?

10 Replies

My mother passed away 2 years ago, I finally got the estate closed out and got my name on the title. The mortgage I am still paying is still in my mother's name but it has a HAMP incentive, so next year it will be finally exhausted crediting $5k off the loan balance. The mortgage at the moment is 2% interest and it's a balloon type. 

The house desperately needs a new roof, the church put the shingles on wrong. So high winds took a small portion off of it.I keep a tarp over for now. Also needs new siding as well. So I am trying to make the best decision.

It's either I refinance with a fix rate this year and get the roof/siding fixed or wait it out until next year, to get $5k taken off the loan. I know the interest rates are going to continue to increase as the economy is still doing good.  

I have thought about that, but one bank told me I would pay $275/month just for a $10k loan which is 3/4 of the mortgage monthly payment amount. Would paying pure interest first year of the loan contradict saving money on the $5k credit? 

I would refi now before rates get higher, then do the repairs. With the left over money I’d go invest it into another property.

I have $40k on the mortgage, but it's tax assessed at $90k but if fixed up premium shape be worth $125k. I plan to take out $20k to use on repairs like siding, roof, deck, new drive way. I could take out additional $10k to get another property.

The roof condition will make it difficult to get a traditional mortgage, whereas I have talked with some local credit unions who do a "desktop underwriting" value of the house when they run the numbers for a HELOC. I found their value to be lower than the amount that I wanted, but it bypassed a roof inspection when we had roof issues. Not so, in my recent experience, for a full mortgage.

I got a quote of $400 to patch up the roof portion. I see no point of paying $400 only to have the whole roof redone. The interest rates suppose to rise in October between 3-4%. I am thinking of refinancing up to $80k, use it for repairs and use additional money to buy a rental.

@Nate S. Have you considered getting a small line of credit to use specifically for repairs so that you could get a decent appraisal so you can cash out refinance the property because of the equity you have . Then take the money you get , pay off the line of credit ,and use the rest to buy a investment property

REFI now, interest rates only have one way to go from here-up. Pull some out, fix the issues, use the rest to find another deal.

My 2c

I have thought about doing a small line of credit to pay for the siding/roof which I got quote of $9700. The Average quotes I'm getting is that amount for siding/roofs. Then REFI it after the repairs to get more equity out of the house. 

Mortgage amount owed: $42,932.32 including interest.

PITI: $710.67/nxt month in Sep (I'm going to start paying taxes next month, mother was disabled)\

Tax Assessed $90k

If sold $100k-125k

Interest rate atm: 2%(It will increase to 3% in November)

3 Bed/1 Bath- Split level house with a patio in the back.

Possible Rent- $850 to $1,200/month. 

The credit union, wouldn't do a home equity with me because my mother's name is on the mortgage. They saw it as too much risk because they can't monitor the loan. Offering me a credit card of 6 months of .99% then jumps to 9.99% or a unsecured personal loan.

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