Texas and its Section 50(a)(6) Refinance Matrix and Summary Guidelines

[Juan Garcia]

Little bit of a backstory. 

- One of my brothers (A) signed for a property for my other brother (B) which will not qualify due to his low credit score. Recently my brother (B) got divorced and will have to payout his exwife's portion of the property (50K). The plan originally was to do a cash out refinance for 150K and have enough to pay his Ex-wife, Current mortgage balances for both my brother (B) (34K) and also pay off the the primary residence for brother (A) (10K; which is the the person who signed for the property). 

House is currently worth 220K at appraisal 

Refinance got approved through a local credit union here in town but last minute they said it would no longer be approved due to Texas50(a)(6); which states that the borrower HAS TO RESIDE within the property that the refinance is for. Reason for the denial is that the Refinance was for the primary residence of brother (B) but my brother that applied for the loan (A) resides in his own primary residence which is not the same address in question for the Refi. 

Any Advice on what could be done here would be greatly appreciated ladies/gents. Unfortunately, brother (b) still will not qualify to refi due to his low credit. 

- Sell the property ? 

- Have brother A refinance his actual current home he's about to finish paying out? 

- any other loan options we can look into ? 

 Thank you!

[Danny Webber]

Let me think on this