Been able to re-fi mortgage after a job loss? (UPDATE POST #8)

[Luv Bunnies]

My husband was laid off last year and is still pounding the pavement looking for a job. He has been receiving unemployment. I work part time and make a decent hourly wage. The current interest rate for our mortgage is 6 3/8% and we would like to bring our payment down, if possible. My husband called Wells Fargo today (our lender) and asked if they could give us a better interest rate. The agent said we could get 5 1/2% which would bring our payment down by almost $300 a month. When my husband told him he was currently unemployed, the agent said he would send the request to the loan officer and see if it goes through. They have an offer for current customers with no points and no appraisal and we'd like to take advantage of that. The good new is that our loan amount is very low compared to the value of our house. We also have other assets that, if liquidated, would more than cover our loan amount. We're hoping they'll take those things into account even though my DH is unemployed. We have a spotless payment history with Wells Fargo and we'd like to think they'd want to keep us as customers. We have no other debts except for our mortgage. Does anyone else have experience with refinancing while one person is unemployed and were you able to do it? We won't find out for a few days but I'm trying to assess our chances of it going through. An extra $300 a month would go a long way right now! Thanks in advance!

 

[Lisa_M]

Do you work? If you do and can qualify based on your income it would probably be fine.

 

[ohlas]

what is worst thing that can happen they say nooooo and you still have current loan????????????? did you sign a you must have a job clause lol

 

[elgerber]

If your income is enough to qualify on, then it will be no problem. It is unfortunately about your debt to income ratio, so without knowing that (which we have no business knowing) it's really hard to say. The days of qualifying without income is unfortnately over. I hope you are able to work something out.

 

[*pixie*dust*]

Like other said, if your income alone will qualify you, then it may go through. Unemployment, since it is temporary, won't be used in the debt calcualtions. IT will all depend on your income alone. Good Luck.


Edited to add: If you are not approved, you may want to see if they will give you a temporary hardship modification on the mortgage, since DH is unempolyed.

 

[CherylA]

Like other said, if your income alone will qualify you, then it may go through. Unemployment, since it is temporary, won't be used in the debt calcualtions. IT will all depend on your income alone. Good Luck.


Edited to add: If you are not approved, you may want to see if they will give you a temporary hardship modification on the mortgage, since DH is unempolyed.

Exactly, most mortgage companies have a 'default prevention' department. Sometimes you can qualify to have your rate reduced based on the fact that one of you is unemployed and you are having trouble making ends meet. The purpose is to keep homes out of forclosure. The banks don't want foreclosures any more than you do. If your current refi request doesn't work out try asking about 'default prevention' and see if you can get your payments lowered that way.

 

[Gr8t Fan]

We did a refi with Wells Fargo about 5 years ago and one of the things we had to certify was that DH and I were both still working in the same jobs as when we originally got the mortgage.

 

[Luv Bunnies]

The loan officer from Wells Fargo called yesterday to verify a few things on the re-fi we requested. My husband told him he was still unemployed and asked if that would present a problem with the re-fi. The loan officer asked how long he's been unemployed and he said almost 10 months. The loan officer said that wouldn't be a problem at all. If he had been unemployed for less than 6 months, they wouldn't even consider the loan. The reason is that we have already established that we can still make our payments on time despite my husband's employment status. So, the longer you are unemployed, the easier it is to get a re-fi. I thought that was very interesting! The good news is that the loan should be going through next month and we will be able to reduce our monthly payment by $300.

 

[dd50]

The loan officer from Wells Fargo called yesterday to verify a few things on the re-fi we requested. My husband told him he was still unemployed and asked if that would present a problem with the re-fi. The loan officer asked how long he's been unemployed and he said almost 10 months. The loan officer said that wouldn't be a problem at all. If he had been unemployed for less than 6 months, they wouldn't even consider the loan. The reason is that we have already established that we can still make our payments on time despite my husband's employment status. So, the longer you are unemployed, the easier it is to get a re-fi. I thought that was very interesting! The good news is that the loan should be going through next month and we will be able to reduce our monthly payment by $300.

Wow, that is great news.

 

[*pixie*dust*]

The loan officer from Wells Fargo called yesterday to verify a few things on the re-fi we requested. My husband told him he was still unemployed and asked if that would present a problem with the re-fi. The loan officer asked how long he's been unemployed and he said almost 10 months. The loan officer said that wouldn't be a problem at all. If he had been unemployed for less than 6 months, they wouldn't even consider the loan. The reason is that we have already established that we can still make our payments on time despite my husband's employment status. So, the longer you are unemployed, the easier it is to get a re-fi. I thought that was very interesting! The good news is that the loan should be going through next month and we will be able to reduce our monthly payment by $300.

I am happy for you that it is working out. I hope things get better soon!

But that is the weirdest thing I have ever heard from a financial institution. The FI I work for won't even consider using Unemployment as an income source.

 

[bumbershoot]

But that is the weirdest thing I have ever heard from a financial institution. The FI I work for won't even consider using Unemployment as an income source.

The OP is working, and said she makes a good hourly wage. That's how they've been doing the payments.

 

[Luv Bunnies]

The OP is working, and said she makes a good hourly wage. That's how they've been doing the payments.

Yes, they did use my salary to determine if we were eligible to re-fi. Our loan amount is very low compared to the value of our house and we have other assets that would cover the loan value if we lost all of our income. The loan officer did say that if DH was unemployed for less than 6 months, they wouldn't approve us. Since it's been over 6 months, we've established that we can still make our payments on time even without his full income.

 

[smidgy]

The good new is that our loan amount is very low compared to the value of our house. We also have other assets that, if liquidated, would more than cover our loan amount. !

this is a big deal to the mortgage company. so many people are "upside down" on their loans. if you defaulted, they know they still have the value of the house.

The loan officer from Wells Fargo called yesterday to verify a few things on the re-fi we requested. My husband told him he was still unemployed and asked if that would present a problem with the re-fi. The loan officer asked how long he's been unemployed and he said almost 10 months. The loan officer said that wouldn't be a problem at all. If he had been unemployed for less than 6 months, they wouldn't even consider the loan. The reason is that we have already established that we can still make our payments on time despite my husband's employment status. So, the longer you are unemployed, the easier it is to get a re-fi. I thought that was very interesting! The good news is that the loan should be going through next month and we will be able to reduce our monthly payment by $300.

YAY!!! good luck to you. It sucks that people who did everything right suddenly find themselves in a situation they never thought they would be in.

you work part time.. what did you folks do about health insurance? not going into details, but... been there!
people like you deserve all the help you can get.

 

[quentina]

The loan officer from Wells Fargo called yesterday to verify a few things on the re-fi we requested. My husband told him he was still unemployed and asked if that would present a problem with the re-fi. The loan officer asked how long he's been unemployed and he said almost 10 months. The loan officer said that wouldn't be a problem at all. If he had been unemployed for less than 6 months, they wouldn't even consider the loan. The reason is that we have already established that we can still make our payments on time despite my husband's employment status. So, the longer you are unemployed, the easier it is to get a re-fi. I thought that was very interesting! The good news is that the loan should be going through next month and we will be able to reduce our monthly payment by $300.

Question....are they re-writing the original note or are you doing a complete refinance (closing costs etc??)

I had a 5 year ARM with them. When the ARM was due to change, it went down. THen it went down again....and again (3 times total). I want to lock in but do not want to refinance. My friends told me that they renegotiated their rate however; they were behind on payments and I think that may have come into play.

So....can you re-write a current note is my ????

 

[Luv Bunnies]

this is a big deal to the mortgage company. so many people are "upside down" on their loans. if you defaulted, they know they still have the value of the house.




YAY!!! good luck to you. It sucks that people who did everything right suddenly find themselves in a situation they never thought they would be in.

you work part time.. what did you folks do about health insurance? not going into details, but... been there!
people like you deserve all the help you can get.

I work for a school district that offers benefits to part timers. It takes about a third of my take home pay, but at least we're covered!

 

[Luv Bunnies]

Question....are they re-writing the original note or are you doing a complete refinance (closing costs etc??)

I had a 5 year ARM with them. When the ARM was due to change, it went down. THen it went down again....and again (3 times total). I want to lock in but do not want to refinance. My friends told me that they renegotiated their rate however; they were behind on payments and I think that may have come into play.

So....can you re-write a current note is my ????

Ours is a complete re-fi that sets the clock back to 30 years. After DH gets a job, we're planning to add to the principal each month to get it paid off sooner. They had a deal for current customers with no appraisal and no closing costs. I think if you re-write a current loan it's called a "loan modification." As I understand it, those are for more extreme circumstances where someone is about to lose their house.