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Consolidating 1st and 2nd mortgages

FHA allows homeowners to subordinate their existing second mortgage to a new first FHA loan.Subordinating is simply a fancy mortgage term for letting the first lender skip in line on the title.However, if the HELOC or second mortgage was taken out after the original mortgage, it would be termed as a cash-out refinance, which has a separate set of guidelines on loan to value.Providing you have the home equity available, you may be able to secure a piggyback mortgage that is a combination of a first and second mortgage or HELOC from the new bank.

The home must have at least 15 percent equity at closing to qualify.

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Homeowners can combine their first and second mortgages into one mortgage insured by the Federal Housing Administration.

This program allows homeowners to consolidate their first and second mortgages, as long as a second mortgages is at least 12 months old or was used to purchase a home.

The homeowner also finances the closing costs and any prepayment penalties charged by the current lenders.

964 comments

  1. You have no equity in your home and two mortgage loans, something you'd like to change. You can combine your first and second mortgage loans into one loan with one payment through a refinance. But.

  2. Homeowners can combine their first and second mortgages into one mortgage insured by the Federal Housing Administration. This often helps a homeowner's finances by consolidating the two mortgages into one and lowering the overall mortgage payment. FHA makes this possible with low equity requirements for.

  3. Our current loans are 1 30yr fixed @ 5.34% and 2 30fixed @10% with balloon at 15yrs. We purchased in 2007 for $372,500 and still currently owe $330,000. Where, if possible, can we obtain a new loan willing to consolidate the two without taking any cash out. thanks. March 08 2013 - Temecula. 0. 0Yes.

  4. If you have the ability to refinance your 1st and 2nd mortgages together for a lower interest and monthly payment without adding mortgage insurance, you should move forward with that loan consolidation option immediately. Most homeowners do not have enough equity in their home to refinance 1st and 2nd liens together.

  5. Dec 21, 2012. Could I refinance my first mortgage just to reduce the rate without getting into appraisals, etc. When that happens, conforming guidelines will dictate that the refinance you complete to consolidate the two will be considered a "cash out" refinance even if no cash goes back to you and cash out refinances.

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