Got a question: Have a person that brought a home almost 2yrs ago and will need to refi before Nov. (ARM will be ending). She got this loan as a stated loan. Well her scores have went down in the dumps and her scores are like in the 400's. So she can't refinance her home. However he husband scores is around the mid 500's but he is currently in bankruptcy chapter 13. He has been late with his payments but have never been late on their mortgage. He will be able to verify his income. Been in the same line of work for the past 9yrs. Makes about 4200k/mo. But he is not on title. (Just got added about 2 weeks ago). Can they still get a loan through FHA even if it is just a rate and term.

bump!

What a nightmare, I can't answer this one, but if I had to guess I would say that is a foreclosure getting ready to happen. Not much help, sorry.

Having the husband on Title is a good start.IMO What is the market value of your home? I don't see any harm in calling FHA and getting their input. FHA has certain loan limits based by the metropolitan area or county of the property. The highest FHA mortgage right now is somewhere around $363,000. They will also allow you to refinance 98.75 or 97.75 of your Appraised Value. Getting Cashout will be a lower LTV, of course.

Good Luck,

If the husband just got added to the title and currently in BK, that just killed it. I sincerely doubt that any one would consider bailing out these folks. Besides that, the home may not even be worth the same today as it did two years ago.

I'll agree that the scenario doesn't look too pretty.

If the client hasn't done so yet, you can have them call their lender and explain their financial situation and hardship. Most lenders now are willing to listen and offer options because the last thing that they want is another... you guessed it... foreclosure.

FHA will not refi out of a Chap. 13.

The situation that you have described does not sound like there are any options available involving refinancing.

As Promise mentioned they can contact their current servicer to talk about a note modification (the fact that they have not paid the mortgage apyments late may actually work against them for that) or consider selling the property.

Or . . . and i realize most folks don't even think of this as an option . . . they can honor their existing note, buck it up and continue to make their payments even though the payments are adjusting upward.

That is definitely a rough scenario. Look at it this way, if they were able to refinance for whatever reason they'd have a hard time getting a lower rate than what their loan is going to adjust to anyway. Him filing for bankruptcy means he can't afford to pay his bills and her with that credit score means basically the same thing. They better hope they can afford the mortgage when it adjusts (probably every 6 months). Tell them both to start doing some credit repair her now and him after his chapter 13 is discharged and see what they can do in the future.

I talked with a friend of mine about these clients and he stated that they probably can't do a refi pulling cash out but just a rate and term refinance with FHA. I even had got a flyer on doing a refinance out of bk even if your payments are behind. I will take another look at that. Thanks for all the replies.

The husband is in BK. Its not going to happen

We've had success in removing BK's typically 6mo after discharge. We currently average over 40% fix/deletion rate in the first 45 days. Clients can log in to their account 24/7 and view DETAILED account info, as well as call client support for any questions or concerns. Also, we have a FREE Broker Program where you can send clients to us and track their progress... Check it out at http://convertturndowns.com

Our brokers see 5-10 clients become loan worthy after the first 45 days of service, with score increases anywhere from 30-100 points.

Matt, relax will you! Every forum I log into you have posted something about your service. There is a section specially built for you to peddle your services.

Refinancing and paying off a CH13 or leaving the CH13 can be done FHA but the problem you would have is that the husband has been late on his BK payments. That right their will kill the deal. I have done quite few CH13 FHA refinances without paying off the CH13 but if when you get the pay history from the trustee it states he has not been on time you are sunk. The fact he was recently added to title doesn't help either.

NO!!!!!