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i need to move out of state and buy a home i will have to get a home equity loan for the down payment. i am having trouble selling my present home so i need to rent it out. but i want to refinace for a lower interset rate

3 Thoughts on should i refinance mortgage of home equity loan first?
  1. Reply
    Angry Bird
    September 9, 2012 at 1:06 pm

    Must you buy in the new state right away?
    Couldn’t you rent in this new state until your home gets sold?
    Also, it’s nice to rent for at least 6 months, that way you get to know the area/city.

  2. Reply
    A Hunch
    September 9, 2012 at 1:31 pm

    As a rental, you are unlikely to get as good an interest rate.
    You have to notify your lender that it is a rental or you are breaking the terms of your mortgage.

    To answer your question = you would ONLY refinance. When you refinance you would take the additional money out of the mortgage.
    Example:
    House is worth $ 100,000
    You owe $ 50000 on existing mortgage
    You want $ 25000 for new down payment
    new mortgage would be for $ 75000

  3. Reply
    the kid
    September 9, 2012 at 1:58 pm

    Getting an equity loan for the down payment is probably going to prevent you from getting the new loan.

    If you don’t have the equity, you can’t do both, or even one, depending on the equity you DO have.

    And unless you have the income to support both mortgages, the whole point is moot.

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