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2nd lien cash out refi

2,385 Views | 12 Replies | Last: 3 yr ago by Jay@AgsReward.com
AgRebel08
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We have been working with a lender to refinance our 1st lien and get cash back.

Part of this means that our 2nd lien lender has to agree to resubordination. They agreed to do this a month ago and today as we are about to close they say its policy not to do this. Now after a month this is falling apart.

Are their lenders that would refinace a 2nd lien?

Is there any legal remedies as we have email approval from the 2nd lien provider?

RockOn
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AgRebel08 said:


Is there any legal remedies as we have email approval from the 2nd lien provider?


Probably not. The combined loan-to-value was probably a moving target and could be seen as a material change to the subordination request.
SteveBott
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Is the property in Texas?
Jay@AgsReward.com
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You should not need a subordination agreement in Texas. Should be able to do a renewal and extension. Still get with the CLTV negative adjuster but do not need the subordination agreement.

EDIT: Looks like I misread the question. Is the current second lien a purchase money second or a cash out loan taken out after the purchase?
aggiepaintrain
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Is your current 2nd lien a Texas Home Equity lien?

Why not have the 1st payoff all liens?

AgRebel08
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RockOn said:

AgRebel08 said:


Is there any legal remedies as we have email approval from the 2nd lien provider?


Probably not. The combined loan-to-value was probably a moving target and could be seen as a material change to the subordination request.


How is it moving if they have a new appraisal?
AgRebel08
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SteveBott said:

Is the property in Texas?


Yes
AgRebel08
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Home built 2018
Original purchase price 630k
Orginal first lien 500k @ 4%
Orginal 2nd lien 70k @ 5.25%

We told 2nd lien we are doing cash out refince. They said no problem.

Appraisal comes back as $740k

First lien cash out balance now 508k - 22k cash back @ 3%
2nd lien says they won't resubordinate- deal blows up.

I'm wondering would any new 2nd lien lender take out our current 2nd lien lender.

Pretty upset since we have verbal and email confirmation from 2nd lien saying it was ok prior to new appraisal and rate lock.



jja79
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Was the 2nd lien lender aware the superior lien was increasing in amount? If not I'm not really surprised at their stance. You're already being priced as a cash out so why not pay them off and increase your new loan amount?
AgRebel08
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jja79 said:

Was the 2nd lien lender aware the superior lien was increasing in amount? If not I'm not really surprised at their stance. You're already being priced as a cash out so why not pay them off and increase your new loan amount?


They were aware.

I dont think we can increase over th 510k limit but I'm not a mortgage banker, some rule for that.

Would love to have all 570k on a fist lien
SteveBott
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510k limit is for conventional loans and are priced better. Over that it's a jumbo loan and that market is very hit or miss depending on the lender. He might not have good pricing for those loans. You may have to shop the deal again
Jay@AgsReward.com
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You can absolutely get a cash out loan over 510,400. Just your lender does not have the ability to do it.
AgRebel08
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Whats the jumbo rate at these days I just dont know if the rate saves us money.

I dont mind doing a jumbo that gets cash out but would hate to pay up for that.

Bottom line I was mislead to belive I could get 22k cash back and lower the rate to 3%
Jay@AgsReward.com
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for a 30 year fixed, it is moving quite a bit due to pipeline control (meaning the when rates are lowered there are so many locks that the investor has to raise the pricing to slow down the volume) and right now it is on the higher end of the cycle. But, I have done and expect to in future done jumbo cash outs in the low 3's. 15 year right now would be 3% as well.

and of course credit score, loan to value, how much you pay in costs all effect the actual rate.
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