San Diego, CA · Member since 2016 · 58 posts · 2 votes
All things equal and assuming that other loan parameters like DTI/etc are met, does having a share-appreciation mortgage/home equity investment/reverse mortgage disqualify one from getting a refinance from a conforming/agency loan program?
Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
2y
Shared appreciation loans do not give more than 70% loan to value, depending on location less.
You cannot refinance conventional AFTER you record a shared appreciation agreement, it has to be paid in full/closed, you may have penalties.
You added reverse in the heading. That does not work with shared appreciation. Several types of reverse- HECMs you have to be 62 years old and your age is part of the factor of the LTV- generally 50-65% ltv depending on your age. You can refinance conventional and payoff a reverse- IF you have equity and can qualify. People do a reverse because their income is not enough to do a conventional loan.
Lender · Warwick Rhode Island · Member since 2023 · 37 posts · 20 votes
2y
Are you asking if the subject property has one of these in place and you are looking at a 2nd position loan? If so, the approval becomes challenging.
Or are you asking if you have this type of financing in place on property A and if it would affect your application on property B? I believe an underwriter would review the loan paperwork and debt you for the worst possible scenario that that loan could adjust to. If the DTI still works, great.
Are you asking if the subject property has one of these in place and you are looking at a 2nd position loan? If so, the approval becomes challenging.
Or are you asking if you have this type of financing in place on property A and if it would affect your application on property B? I believe an underwriter would review the loan paperwork and debt you for the worst possible scenario that that loan could adjust to. If the DTI still works, great.
Both the shared appreciation mortgage and refi mortgage would be on the same property, the shared appreciation being 2nd lien position.
Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
2y
Shared appreciation loans do not give more than 70% loan to value, depending on location less.
You cannot refinance conventional AFTER you record a shared appreciation agreement, it has to be paid in full/closed, you may have penalties.
You added reverse in the heading. That does not work with shared appreciation. Several types of reverse- HECMs you have to be 62 years old and your age is part of the factor of the LTV- generally 50-65% ltv depending on your age. You can refinance conventional and payoff a reverse- IF you have equity and can qualify. People do a reverse because their income is not enough to do a conventional loan.