How To Refinance Second Mortgages Heres What You Need To Know
Many homeowners refinance their mortgage at least once during the lifespan of their loan. If you already have a second mortgage, you may not have considered the possibility of refinancing your second mortgage. Refinancing second mortgages may prove to be beneficial for homeowners who are looking for lower interest rates and monthly payments.
Refinancing a second mortgage is generally similar to refinancing the first mortgage, but there may be different reasons to refinance again.
If you want to learn about refinancing your second mortgage, then read on. Youll need to take some steps in order to refinance.
Wisconsin Down Payment Assistance Programs
The Wisconsin Housing and Economic Development Authority has a program called Capital Access that provides up to $3,050 toward your down payment and closing costs.
This comes in the form of an interest-free second mortgage that falls due only when you finish paying your first mortgage, refinance, or move to a new home. So there are no monthly payments.
Learn more at the WHEDA website. You should also check out the Easy Close down payment assistance program which can provide up to 6% of your primary loan amount as a 10-year fixed-rate loan that requires repayment.
And you can check out HUDs list of other programs in Wisconsin.
New Jersey Down Payment Assistance Programs
First-time buyers in New Jersey can get up to $10,000 in down payment assistance through a five-year, forgivable loan with no interest or monthly payments required.
The loan must be paired with a first mortgage from the New Jersey Housing and Mortgage Finance Agency which can be a 30-year FHA, USDA, or VA loan.
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Pros And Cons Of Refinancing
Like with any loan, there are some pros and cons when it comes to an FHA cash-out refinance. This type of loan may benefit some, but it could be the wrong option for others.
- Using an FHA cash-out refinance, your home equity can be turned into cash that can be used to put you in a competitive financial position.
- An FHA cash-out refinance is a great option if you plan to reinvest it into your home by doing renovations or making improvements.
- It can be a great way to consolidate your high-interest debts, such as credit card debt, student debt, or car loans.
- Since FHA cash-out refinance requirements are more lenient than those of conventional loans, FHA loans are more accessible, especially to those with low credit. The official minimum credit score to qualify for an FHA cash-out refinance is 500. However, be aware that lenders may look for a higher credit score. These loans also provide a higher maximum LTV than conventional loans.
- FHA loans are assumable, meaning that they can be transferred from an existing owner to another buyer after evaluation by the lender.
How To Request Mortgage Relief
Help will be available only to those who ask for it. And the organization you need to ask at least, at first is your loan servicer. Thats the company to which you make your monthly mortgage payments.
Note: Your mortgage servicer is likely not the same company that set up your loan. To find out who your servicer is, check the company name and contact information on your most recent mortgage statement.
You should work with your loan servicer to discover programs that may help you.
Not all types of mortgages offer the same relief, and there may be state or local assistance you can tap.
But dont rely solely on the knowledge of the agent to whom you speak. Do some research of your own online. Youll find some links below. And Google is your friend.
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How Can You Receive Your $25000 Down Payment Grant
When the Downpayment Toward Equity Act passes into law, it will be an automatic payment made to your closing. Your mortgage lender will facilitate the grant and complete the necessary forms.
All you will be expected to do is buy your home, show up at closing, and find your cash grant waiting.
However, if the bill is moving too slowly for your home purchase timeline, there are other down payment assistance programs for first-time buyers to consider including local incentives and low-down payment mortgages.
Can I Get A Lower Mortgage Rate
Yes, there are ten ways that first-time home buyers get lower mortgage rates.
Get pre-approved for a mortgage today.
Dan Green is a former mortgage loan officer and an industry expert. He’s appeared on NPR and CNBC, and in The Wall Street Journal, Bloomberg, and dozens of local newspapers. Dan has helped millions of first-time home buyers get educated on mortgages, real estate, and personal finance. Have mortgage questions? Ask Dan in the chat.
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Tax Rebate On Purchase Of New Homes In Ontario
Lets face the simple fact that we all want to save money whenever possible. There are ways to save money but unfortunately sometimes we simply dont know what they are. Our firm wants to inform you of some ways that you too can minimize the tax obligations arising from purchase of new homes by saving money through the tax rebates that are currently available to purchasers of new homes in Ontario.*
Then contact our office so that we can guide and assist you through this somewhat complex, time consuming process giving you the peace of mind that you are in the right hands!
How are property purchases taxed in Ontario?
As of July 1, 2010, the harmonized sales tax has been in place in Ontario at the rate of 13%. This tax is composed of two separate parts: a 5% goods and services tax and an 8% retail sales tax . In general, the potentially hefty HST is applied to any purchase unless it falls within one of the limited exemptions.
What types of properties are subject to the HST?
New homes are not exempt from HST, in Ontario leaving the purchaser of these types of home on the hook for a potentially large tax obligation. The main exemption where the HST does not apply is the sale of used housing or resale homes. It is important to note that this exemption does include different types of resale homes including residential condominium units.
What exactly is the rebate program?
What homes qualify for these rebates?
The $25000 Downpayment Toward Equity Program Expected In 2022
In 2021, Congress introduced a bill titled The Downpayment Toward Equity Act, a home buyer grant for first-generation home buyers with extra grant money available to renters with socially or economically disadvantaged backgrounds.
The Downpayment Toward Equity Act awards up to $25,000 so renters can buy their first home. Grant monies can be used to make a down payment, pay for closing costs, lower your mortgage rate by using discount points, and cover other expenses, too.
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Georgia Down Payment Assistance Programs
The Georgia Dream Homeownership Program helps provide affordable financing for low- and moderate-income first-time home buyers.
The program includes down payment assistance loans of:
- $7,500 for most buyers
- $10,000 for public protectors, educators, healthcare providers, active military, and buyers living with a disability or a disabled family member
To qualify, borrowers will need to be within local household income limits and have liquid assets of no more than $20,000 or 20% of the home purchase price .
Salute Our Soldiers Military Loan Program
Active-duty military personnel and veterans can take advantage of several programs that help with 30-year fixed-rate mortgages, including from the FHA, VA or USDA Rural Development. Interest rates for these loans are typically lower than for conventional ones, and they can be used in tandem with other Florida Housing down payment and closing cost assistance programs to further lower costs.
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Nevada Down Payment Assistance Programs
The State of Nevadas Home Is Possible Down Payment Assistance Program can provide a grant of up to 5% of your loan amount. And there are no asset limits or first-time purchaser rules.
To be eligible for Nevadas DPA program:
- Your qualifying income must be below $105,000 as a single borrower or $135,000 for two or more borrowers
- Your credit score must be 640 or above
- The purchase price of the home must be under $647,200
- You have to pay a one-time fee of $755
- Teachers and military service members can qualify for better interest rates
New Mexico Down Payment Assistance Programs
The New Mexico Mortgage Finance Authoritys FIRSTDown DPA program offers help with closing costs and down payments to first-time buyers. It provides up to $8,000 as a 30-year second mortgage at a relatively low interest rate.
- This program must be used in conjunction with New Mexicos FIRSTHome mortgage financing program
- There are caps on household incomes and home purchase prices. But those may be higher if youre buying in a target area
An alternative program, called HomeNow, also offers up to $8,000 in down payment assistance. The difference is that this loan can be forgiven after 10 years and is only available to borrowers with an income below 80% of the area median income .
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What Is A Mortgage Relief Refinance
When most people think of government or Congress mortgage relief, theyre thinking of HARP the Home Affordable Refinance Program. HARP was a government program rolled out by the Federal Housing Finance Agency in 2009. For nine years, it helped millions of homeowners refinance after being hard hit by the housing crisis.
The HARP program ended in 2018. And similar programs, including Fannie Maes HIRO and Freddie Macs Enhanced Relief Refinance, were also discontinued.
The reason? Home values have been rising dramatically.
Property values shot up at a record rate in 2020 and 2021. As a result, homeowners nationwide saw their equity levels increase. And the number of underwater borrowers shrunk to just 2% of the market.
There are still programs available to help homeowners with little or no equity, including 97% LTV refinancing from Fannie and Freddie and Streamline Refinancing from FHA, VA, and USDA. However, fewer and fewer homeowners need these programs.
Today, the focus is on helping homeowners who were impacted by Covid-19 lower their mortgage payments.
Bank Of Americas Community Homeownership Commitment
Good news for aspiring homeowners! Bank of Americas Community Homeownership CommitmentÂ® is bringing together products and resources that can help modest-income borrowers buy homes of their own. By combining down payment assistance and closing cost help with a low down payment mortgage, you may find that a new home is within reach.
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What Is The Programs Current Status
As of December 1, 2022, the $25,000 first-time home buyer grant remains a bill. There are versions in discussions within the House and also the Senate.
Rep. Maxine Waters authored the House version of the bill, which has 64 co-sponsors. Senator Raphael Warnock authored the Senate version of the bill, which has six co-sponsors.
The bills timeline is:
- July 17, 2021: H.R. 4495 introduced in the House of Representatives as Downpayment Toward Equity Act of 2021
- September 30, 2021: S. 2920 introduced in the Senate as Downpayment Toward Equity Act of 2021
Grant money for home buyers is unavailable until the House or Senate version of the bill are passed into law.
Homebuyer.com maintains a page with status for all first-time home buyer government programs in Congress. We update the page often.
Federal Stimulus For Homeowners
HIRO and FMERR are some of the special stimulus programs put in place by the government for homeowners looking to purchase a new home.
They are special programs that are ideally suited to the current state of the market and the fact that interest rates are at an all-time low. They come with reduced interest rates and minimal monthly payments, which are easier to manage, and more people can afford them.
People buying a home for the first time will find these programs especially useful and suited to their needs. Refinance relief programs can help you make use of the low-interest rates, and in the process, you will also be able to take advantage of low-interest rates.
Even when your mortgage is higher than the value of your home, there are programs in place that are designed to ensure that you can conveniently make payments without worrying about the terms.
Terms have been made easier for new home buyers, and the interest rates and monthly payments have also been reduced. This is the opportunity many people have been looking for, and to start making use of them, start checking your refinance eligibility and the program that suits you best.
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What Is The Downpayment Toward Equity Act Of 2021
The Downpayment Toward Equity Act of 2021 provide eligible first-time home buyers up to $25,000 cash for down payment on a home, closing costs on a mortgage, interest rate reductions via discount points, and other home purchase expenses.
As of December 1, 2022, the program requires that home buyers:
- Be a first-time home buyer
- Earn a low- or moderate income consistent for their area
- Buy a home that will be a primary residence
- Use a government-backed mortgage
- Be a first-generation home buyer, or have parents or legal guardians who defaulted on a home loan, or lived in foster care during their lifetime
The Downpayment Toward Equity Act may not be used to purchase a second home or rental property, and all home buyers within the household must the meet the programs eligibility requirements.
California Down Payment Assistance Programs
The California Housing Finance Agency MyHome Assistance Program provides down payment help for eligible buyers. This takes the form of a second mortgage of 3-3.5% of the homes purchase price or $11,000 whichever is less.
- The program provides 3% for homes financed with conventional or USDA loans
- It provides 3.5% for homes financed with FHA loans
This is a first-time home buyer down payment assistance program. So it wont help if you already own an existing home.
However, CalHFA defines a first-time home buyer as someone who has not owned and occupied their own home in the last three years. So many whove previously owned homes may qualify.
Check out the MyHome Assistance Program webpage for more information. Youll find some income limits there. If youre a teacher or fire department employee, certain program limits may not apply.
Also take a look at HUDs list of alternative programs for California.
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Minnesota Down Payment Assistance Programs
The Minnesota Housing Finance Agency provides two types of down payment assistance loans to eligible borrowers:
- Monthly Payment Loan: Borrow up to $17,000 at the same rate you pay on your first mortgage. Pay that down each month over 10 years
- Deferred Payment Loan: First-time buyers can borrow up to $11,000 free of interest. You make no payments, but the balance will come due when you finish paying off the mortgage, refinance, or sell the home
North Carolina Down Payment Assistance Programs
First-time and repeat home buyers may be eligible for a down payment loan of up to 3% of their mortgage balance with the NC Home Advantage Mortgage.
- This assistance loan starts to be forgiven in year 11 of your mortgage and will be fully forgiven by year 15. If you sell, transfer or refinance before year 11, youll have to pay back the whole amount
- NC Home Advantage also has a similar program offering $8,000 in down payment assistance to veterans and first-time homebuyers
Use the link above to get more information from the North Carolina Housing Finance Agencys website. And review HUDs list of other homeownership assistance programs in the state.
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Down Payment Assistance Programs For Homebuyers
The following down payment assistance programs and/or grants were researched by the team at FHA.com. Please note that all programs listed on this page may involve a second mortgage with payments that are forgiven, deferred, or subsidized in some manner until resale of the mortgaged property.
This is not a complete list, but it can serve as a starting point in your search for the down payment assistance program or grant for your situation. It is up to the consumer to contact these entities and find out the specifics of each program.
How Long Does It Take To Get Down Payment Assistance
How long it takes depends on the program and the type of assistance. Each state offers its own programs, as do different cities and organizations. These programs move at different speeds depending on the demand and size of the program.
Its important to know that, if you apply for down payment assistance, it may take longer to close on your home. The assistance program must work with your lender to secure the loan and the down payment funds. This can add time to the closing process, depending on how quickly the down payment assistance program acts.
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