I currently have a mortgage with a 1st at around 382,000. Its a neg am loan that continues to add to the balance. It also has a pre pay for another year. So to re-fi now the payoff would be approx 390,000. I am self employed and need a stated type loan. My current payment with t&i is 1600 dollars a month. What type of loan do you recommend? I do not want any cash out. The home should appraise at 440-470K. I only plan on being there a few more years maybe less. I am located in California if it matters and have a mid to high 700 fica score.

Also has anyone ever heard of getting out of a pre-pay with countrywide?

There isnt a way to get around the prepay penalty but I have a contact at Countrywide that may be able to reduce the amount significantly. I'm in CA too so drop me a line if you want to know more.

Aaron (at) RealEstateFinance.com

I like your new site Aaron, looks great!

For the record:

A POA is not a sub prime loan, you pretty much have to be an A borrower to qualify for one.

If you are truly planning on selling the property in a couple of years or sooner you are probably better off not refinancing. Try making the I/O payment option to avoid deferring interest if that bothers you. IMHO there is not a thing wrong with deferring interest and getting the additional cash flow on a property that you will not be holding on to long term.

CapitalAdvisor pm sent, thanks.

sdmortgagpro thanks for clarifying. So you are saying I must of had a good credit rating to get this loan? It sounded to me like these loans everyone is speaking of on the news. I may start making the i/o payment. That is a good option at this point. I am going to throw the house on the market for a couple months and see if I get any interest. If not I will be staying. Thanks for the info.

The news is good at lumping all loans into on pile. You have a special loan that can obviously put you into negative amortization, but by making that IO payment you should be ok. When did you close on that loan, and do you know what you Loan to value was at that time? Whats your loan amount vs. Property appraised value at closing?

The note was originally for 360k. I believe the appraisal came in at 380-390K. It was almost exactly 2 years ago.

If your fico is over 700 this is a do-able loan except you can't really get away from the pre payment penalty. When is your pre pay over?

For those homeowners trying to get out of a sub-prime 80/20 ARM loan...try an FHA (fixed rate)refinance with the following conditions:

1. The first TD balance and prepay, if any, must be within your
area's FHA loan limits. Try diligently to get the lender
on the first to waive the prepayment penalty.
2. The second TD must agree to subordinate to the new FHA 1st.
3. Borrower must be able to document income and ability to
make both payments.
4. Current mortgage payments cannot show any lates.
5. FHA does not consider the CLTV if they are in the first
TD position.