I am a owner of a investment/vacation home in PA with equity seeking to either refinance or obtain an equity loan. Due to a low score when I obtained the house (12/2002), my interest rate is very high. My score gradually went up until this past winter when I had mechanical problems needing to be fixed. I struggled for 6moths going check to check behind a month with the bank not willing to offer me any options and could not catch up. I received an ACT91 letter from the bank. As of now, they offered me a forbearance agreement to finance the past due over 6months. I am not sure if this is the best option. it may be to save the home, but fior the long-term I am looking here.
This past month, in my attempt to refinance, I am getting similar or slightly lower rates. My credit score is around the 500 mark depending on the agency. I am current on all other bills: car, credit cards, etc. I am in credit card debt for $2k, that’s all. I am currently working for over 5 years a the same job income is $72k.
My 1st mortgage is $84k at 10% and the 2nd is $20k at 14%. The home is worth approach $130. last appraisal was 3/2003 for $120k.
I am seeking 1 of these 2 options.
#1) I am looking to refinance the 1st and 2nd mortgage of $104k with no out of pocket expenses and no cash out, just a clear refinance.
#2) Obtain a loan for $10k for under 10% to be paid back over 3 years. This would be paid back sooner but I can only afford the payment amount if the terms are over 3 years so i don’t fall behind again.
My verifiable income is my source to pay back the loan, in addition I have a pending return with the IRS with money due me when it is all completed. I filed my 2004 returns late and due a refund of $5800. However I handed in a amended return for 2002 and 2003 which included the home which i did not submit the 1st time. With the tax deductions I am due $15k. Due to an error on my 2003 they placed a refund hold pending the 2003 correction. The total return amount for 2002-2004 is a refund of $15k. The 2004 was approved and is on hold but the 2002 and 2003 has not yet been approved, they tell me processing. I have letters from the IRS advising the 2004 refund hold only due to the pending an error on the 2003 that has been corrected. The estimated time for the refund to be processed they say is 2 months.
I am willing to hear any reasonable offer. My goal is to reduce the interest rate and payment. However I am willing to hear another option to get back on track.
I have all my paper work in order: mortgages, state license, banking records etc.