Combining 1st and 2nd Mortgages

Chances are if you have a home equity line of credit or HELOC the rate is adjustable. As interest rates rise, so will your payments. Now is the time to combine your 1st and 2nd mortgages into one, fixed rate mortgage.

If the new combined loan amount is more than 80% of the value of the property, you may be required to maintain Private Mortgage Insurance, or pay a higher interest rate with a "Lender Pay PMI" mortgage.

Many lenders require that you must have lived in your home for at least 6 to 12 months before you can refinance your home using the appraised value. This is especially important to consider if you believe you bought your home for less than market value.

If your second mortgage or HELOC was not purchase money then it will be considered a cash out refinance under Fannie Mae guidlines.

You may be able to reduce your monthly mortgage payment by refinancing and combining into one loan.