What effects does having a lien on your home have on getting refinancing on your home?
Question by misymagicg: What effects does having a lien on your home have on getting refinancing on your home?
We you not be able to get a loan altogether? Or will they just minus that amount from the amount you are asking? What happens if you were pre-approved on the refinance?
I have plenty of equity in my home. This seem the only way for us to get this project done and get the appraisal too.
Best answer:
Answer by wizjp
Easy. Pay off the lien, or no loan.
They will not put a loan on record behind an open judgement. Loss of lien position in the event of a foreclosure.
To say nothing of any credit issues.
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The pre-approval is just that…PRE-approval.
You have to meet conditions of the loan.
One standard condition…is clear title.
When you have a lien on your home…you don’t have a clear title.
If you are doing a cash-out refinance…the bank will pay off the lien and take it out of the proceeds that you were asking for.
Depends. What kind of lien?
when you refi, all liens are paid off. if those are big it can prevent a refi because collateral is not enough.
You would have to get a large enough mortgage to pay off the lien as part of the refi, or pay it off prior.
PReapproval is irrelevant, they hadn’t done a title search to discover that you had a lien. And it may queer the deal as it indicates a problem in your financial management.
Cannot sell the house or refi without FIRST paying off lien.