Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
refinance mortgage after hasty retirement
Old 04-03-2012, 01:04 PM   #1
Dryer sheet wannabe
 
Join Date: Apr 2012
Location: upstate
Posts: 24
refinance mortgage after hasty retirement

This whole early retirement roller coaster that I am sitting in the front car of, came on too quickly for me to refinance my 4 year old mortgage down from the current 5.5% rate. Now that I am "unemployed", I wonder how easily ( if possible at all) it would be to refinance such a new mortgage. ( original loan of $155K and current amount still $145K) Even if I pick up some sort of employment, it will not have any longevity that would benefit the re-fi.....would it ?
__________________

__________________
phoneguy55 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 04-03-2012, 01:49 PM   #2
Full time employment: Posting here.
 
Join Date: Mar 2012
Location: seattle
Posts: 643
Quote:
Originally Posted by phoneguy55 View Post
This whole early retirement roller coaster that I am sitting in the front car of, came on too quickly for me to refinance my 4 year old mortgage down from the current 5.5% rate. Now that I am "unemployed", I wonder how easily ( if possible at all) it would be to refinance such a new mortgage. ( original loan of $155K and current amount still $145K) Even if I pick up some sort of employment, it will not have any longevity that would benefit the re-fi.....would it ?
If you are married and your spouse pulls down enough to qualify, you might have a shot at it.

My wife & I recently refied 2 rentals, which are harder, of course. Her income clinched it. That and working closely with a local S&L that keeps their loans.
I looked for about 4 months off & on until we got the right noises from a bank.
__________________

__________________
bld999 is offline   Reply With Quote
Old 04-03-2012, 01:54 PM   #3
Recycles dryer sheets
 
Join Date: Jan 2010
Posts: 226
Do you have a pension? I would think depending on the size, you could qualify on that.
__________________
misty57 is offline   Reply With Quote
Old 04-03-2012, 02:38 PM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
FinanceDude's Avatar
 
Join Date: Aug 2006
Posts: 12,484
It might be pretty hard, banks like consistent income coming in like you had. Credit rating alone doesn't work these days.........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)


This Thread is USELESS without pics.........:)
FinanceDude is offline   Reply With Quote
Old 04-03-2012, 03:25 PM   #5
Thinks s/he gets paid by the post
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 3,392
Look into an asset depletion loan. Talk to a mortgage broker. If you have assets there is a formula that is used to determine how much you can borrow. It is based upon amount of assets and age rather than being based upon income.
__________________
Katsmeow is offline   Reply With Quote
Old 04-03-2012, 04:03 PM   #6
Dryer sheet wannabe
 
Join Date: Apr 2012
Location: upstate
Posts: 24
I will check on that asset depletion loan. Maybe I need to prove (over time) that the current monthly payment is being met, and lowering it by a few hundred a month would not be a risk. That is one of the many ways I need to lower my monthly bills. The $400 a month SUV, may have to become a little hybrid in the future too, but again getting a loan may be the challenge there also.
__________________
phoneguy55 is offline   Reply With Quote
Old 04-03-2012, 04:53 PM   #7
Recycles dryer sheets
 
Join Date: Mar 2012
Posts: 125
My husband and I are retired phone people. We both have pensions (and SS). We have refinanced twice since he retired (the most recent refi was last Nov). We had no problems at all. They wanted copies of our pension letters and our SS statements (along with the usual bank statements and 1040's).

As long as your documented income is enough to make the payments, you should be OK.
__________________
dmdunca44 is offline   Reply With Quote
Old 04-03-2012, 05:02 PM   #8
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Mulligan's Avatar
 
Join Date: May 2009
Posts: 7,369
Quote:
Originally Posted by dmdunca44
My husband and I are retired phone people. We both have pensions (and SS). We have refinanced twice since he retired (the most recent refi was last Nov). We had no problems at all. They wanted copies of our pension letters and our SS statements (along with the usual bank statements and 1040's).

As long as your documented income is enough to make the payments, you should be OK.
I refinanced with a pension as my mostly sole income, and it was no problem, also. It seems like we have had threads in the past where asset rich, income poor retirees have struggled to get approval for refi's.
__________________
Mulligan is offline   Reply With Quote
Old 04-03-2012, 05:23 PM   #9
Dryer sheet wannabe
 
Join Date: Apr 2012
Location: upstate
Posts: 24
thanks for sharing your experiences,...maybe I will be able to do this. The asset depletion loan option stated above seems like it may be tricky for me. From the few web sites that describe the details, you either need to be borrowing over $300K or be able to put a substantial percentage down. I will do my due diligence, and keep looking and hopefully will be able to find a way. Thanks folks.....
__________________
phoneguy55 is offline   Reply With Quote
Old 04-04-2012, 12:54 AM   #10
Thinks s/he gets paid by the post
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 3,392
Quote:
Originally Posted by phoneguy55 View Post
thanks for sharing your experiences,...maybe I will be able to do this. The asset depletion loan option stated above seems like it may be tricky for me. From the few web sites that describe the details, you either need to be borrowing over $300K or be able to put a substantial percentage down. I will do my due diligence, and keep looking and hopefully will be able to find a way. Thanks folks.....

This may depend on where you live. I was told I did not need to have a loan over $300k (that may be true in some areas or for some programs). Also, I was told I would need to have it be no more than 80% loan to value (which was fine).

For those saying they got loans just fine with a pension -- well, of course you did...you have documented income. The difficulty can be for those who do not have a pension but simply have savings or received a lump sum. That is where the asset depletion loan comes in.
__________________
Katsmeow is offline   Reply With Quote
Old 04-04-2012, 07:11 AM   #11
Dryer sheet wannabe
 
Join Date: Apr 2012
Location: upstate
Posts: 24
that does seem to be my best hope, so I will pursue that tack for sure. The 80% thing may prevent it though, and paying the loan down to satisfy that requirement will be counter productive also. I may have to just wait a while, but not without exhausting all possibilities first. Thanks again....
__________________
phoneguy55 is offline   Reply With Quote
Old 04-04-2012, 09:26 AM   #12
Full time employment: Posting here.
Accidental Retiree's Avatar
 
Join Date: Feb 2012
Posts: 975
Can you set enough aside for a 72(t)? That series of payments for 60 months can also work as a documented income stream.
__________________
Chief Retirement Strategist
The AR Group
Accidental Retiree is offline   Reply With Quote
Old 04-04-2012, 10:44 AM   #13
Dryer sheet wannabe
 
Join Date: Apr 2012
Location: upstate
Posts: 24
Quote:
Originally Posted by Accidental Retiree View Post
Can you set enough aside for a 72(t)? That series of payments for 60 months can also work as a documented income stream.
Hi A.R. ...
I am still formulating a game plan, as this is only day 4. I just met with my CFP, and his advice is (plan 1): get a job to lessen any distribution from the employers 401K or..(plan 2) set up monthly distributions from 401K at 70-80% of last salary, and try to lower bills as much as possible.
I didn't ask whether those distributions would actually be considered a 72T...or just a withdrawal. I have a few months of savings to allow me to not rush into a plan too quickly. Your advice is well taken, though,...if an actual verifiable income stream is needed to do any kind of refi.

Thanks....
__________________
phoneguy55 is offline   Reply With Quote
Old 04-04-2012, 01:09 PM   #14
Thinks s/he gets paid by the post
Finance Dave's Avatar
 
Join Date: Mar 2007
Posts: 1,046
Quote:
Originally Posted by dmdunca44 View Post
My husband and I are retired phone people. We both have pensions (and SS). We have refinanced twice since he retired (the most recent refi was last Nov). We had no problems at all. They wanted copies of our pension letters and our SS statements (along with the usual bank statements and 1040's).

As long as your documented income is enough to make the payments, you should be OK.
I wonder if an annuity statement would be viewed similar to a pension income by the banks? If you can prove that the annuity income will keep coming...would they accept that as income?
__________________
"Live every day as if it were your last, and one day you'll be right" - unknown
Finance Dave is offline   Reply With Quote
Old 04-04-2012, 01:29 PM   #15
Full time employment: Posting here.
 
Join Date: Mar 2012
Location: seattle
Posts: 643
"I wonder if an annuity statement would be viewed similar to a pension income by the banks? If you can prove that the annuity income will keep coming...would they accept that as income?"

That's one prime reason to try and work with a local bank and get a view into their underwriting. In cases where people have decent assets and really are responsible, but have a non-job income stream, the big banks that advertise teaser rates and sell everything after origination are not interested.

When you can walk in and talk to somebody and realistically make your case, it's a much better shot. You quickly learn that underwriting is "the same, but different" depending who you talk to. The fanny and freddie group are definately constrained.
__________________
bld999 is offline   Reply With Quote
Old 04-04-2012, 08:34 PM   #16
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,616
Quote:
Originally Posted by Finance Dave View Post
I wonder if an annuity statement would be viewed similar to a pension income by the banks? If you can prove that the annuity income will keep coming...would they accept that as income?
Income is income, no matter what kind of stationery the statement is printed on.

I once provided a 1099-R to document my military pension. The lender came back with "Yeah, but how do we know they'll pay you this pension next year?" So I came back with my Retiree Account Statement listing the projected payment for the coming year. The lender came back with "Yeah, but how do we know that they'll keep paying the pension after that?"

I asked the lender if anyone in their organization was a military veteran, let alone a military retiree. Then I said I was going to search for military-friendly lenders. They managed to figure it out.
__________________

__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Super low 5 year Mortgage rate at Penfed - 1.99% FUEGO FIRE and Money 15 04-06-2012 09:48 AM
Reverse mortgage for 80 year old aunt? Zero FIRE and Money 47 04-03-2012 08:26 PM
Early Retirement Dream pfleming Hi, I am... 16 04-02-2012 08:21 PM
update... DAV early medical retirement MuzikLvr FIRE and Money 0 04-01-2012 04:51 PM

 

 
All times are GMT -6. The time now is 04:00 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.