Government Mortgage Rate Refinancing
Proper now I have a fixed-rate mortgage at 6.25% but the job situation is poor and each my wife and I can not afford to pay the mortgage and our debt. Is it feasible to negotiate with our current lender to lower the interest rate to what the government has out now? (lower than five% I believe). How does that process work? I don’t want to refinance, I just want to negotiate for lower interest rate.
Answer by willwork4food89
Yes, banks are normally willing to negotiate. They would rather get lower payments that have to foreclose on a property.
Sure, you can try call the bank or your mortgage company and see and if you want there are some companies out there that will help you sue the bank for a lower rate if your house was sold or refinanced at a high rate than what it’s worth in the market now. Good luck
If you could offer to pay down the principle by say 20% YOU MIGHT HAVE LEVERAGE TO NEGOTIATE.
I do not see any leverage you have to negotiate with. Your strained financial situation would just worsen your bargaining position as it worsens your credit rating.
The only leverage you appear to have is a threat to stop paying and go into foreclosure, which might hurt you more than it hurts the bank. So negotiation room is cramped.
You will not get the federal rate, that is for the banks, not the consumers. 6.25 is pretty good right now for a jumbo loan, but regardless they are not likely to go below 6 and when you take closing costs into consideration it may not be a good idea to change your loan at this time.
SURE, you can try. Your lender doesn’t have to do anything, and may or may not be willing to do so. If you have good payment rate and decent credit, you have better chance of succeeding. Talk to more than one person at lender. And I agree in your situation you want a Loan Modification, changing only the interest rate. Probably won’t get the lowest available rate today, but may be able to reduce your interest rate. They want to know that you can afford to keep current after modification, and avoid foreclosure, or they have no incentive to do this.
I can tell you now, unless you pay for refinancing you won’t get them to lower it any lower than it is now.
Millions of people have “job” situations and overextend themselves. One of you can take out a second job for awhile to lower your debt.
Banks make money by refinancing…they are not going to do it for free and I really wished the news would stop mis-informing the public as if it’s as simple as making a phone call.
It’s very, very rare.