Refinancing With No Income
REM # A636
By Ilyce R. Glink
Summary: A reader is refinancing their home after a divorce and without any income. Ilyce suggests an interest only loan program.
Q: I am getting divorced and my husband is signing the house over to me with
the condition that I refinance it immediately.
My credit score is very good (around 750) but presently my only income is my disability annuity. Starting in February, I’ll also have my spousal support.
I would benefit from being able to take some cash out when I refinance. My home is appraised for about $250,000 and we owe $145,000 on the mortgage.
Do you think it possible for me to refinance based on my credit score? And, if I can refinance, what is the best way to go? I know I'm not going to stay in the house for more than a year or so.
A: Having good credit is a great thing. However, it doesn't compensate for
not having enough income to make the payments on the loan.
If you're going to stay in the house for just a year, then you should try to
get a no-doc interest-only loan to keep your payments as low as possible. But
remember that you will not be building any equity with an interest-only loan.
If there is an increase in equity it will have to come from the general appreciation
in housing values in your neighborhood.
Talk to several lenders in your area about the interest-only loan programs they
offer and how much they charge for no-doc loans. BankRate.com might be a good
place to start your comparison shopping. With such good credit, you may be able
to get a no-doc loan at a favorable interest rate.
NOTE: This column is distributed by Real Estate Matters Syndicate, PO Box 366, Glencoe, Illinois, 60022. This column may not be resold, reprinted, resyndicated or redistributed without written permission from the publisher.
Quit-Claim Deed Question
Quit Claim Deed Transfers Property Taxes
Deed in Lieu of Foreclosure Will Hurt Credit Rating
Using Home Equity To Pay Off Second Loan
Tax Problems Should Lead To Payment Plan With IRS
Link to This Article
Like what you've read? Spread the word! You can link to this article
from your website by copying the following code and adding it to
a page on your website:
Copyright ©2001-2007. ThinkGlink, Inc.
All rights reserved. Reproduction of material from any www.ThinkGlink.com pages without permission is strictly prohibited.
Site designed by Walker Sands Communications
