Consolidating first and second mortgage loans

And the resubordination rules differ for loans under the Home Affordable Refinance Program, or HARP.Before it can refinance your primary mortgage, a lender must submit a subordination package -- all of the documents supporting the request -- to the institution holding your home equity loan or line of credit.When you have two mortgages, you must obtain price quotes on a new first for the amount of the balance on the existing first, and on a new second for the amount of the balance on the existing second.You also need a quote on a new first for the amount of the balance on both existing loans.Appreciation in the value of your house may make it possible to refinance the first mortgage without purchasing mortgage insurance.If large enough, appreciation could allow you to roll both loans into one without paying mortgage insurance.One benefit of consolidating your mortgages is that it can result in lower monthly payments and even reduce your loan rate.Plus, many people find that refinancing their first and second mortgage together adds more structure and organization to their financial life.

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My question is, should I refinance the second only or should I refinance both, and if I refinance both should I take out two new mortgages or should I consolidate the first and second into a new first?Having a home equity loan or home equity line of credit when you're trying to refinance your mortgage adds another layer of complication to the approval process.That's because the second mortgage holder, which is legally entitled to move into first place when the first mortgage is refinanced, has to agree to give up that spot to the refi lender.The second mortgage lender typically charges a fee of to 0 to review the package, says Anne Benjamin, chief operating officer at Redwood Credit Union in Santa Rosa, Calif.The response can take up to six weeks, Benjamin says.They might use the money to pay off a debt, send a child to college, finance starting a business, or make a large purchase.

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