I am in the process of trying to refi through HARP 2.0 as I was contacted by my primary lender (Chase). I was preapproved, told everything was fine, that the bank that holdes my 2nd, The Golden 1 Credit Union would have to agree to subordinate on the loan. The 2nd is for 26K and has about 7 years left on it. We are working at a CLTV of about 150%. Our home is in California.
I have been reading about subordinating loans and the only two things I found about TG1 were that they denied the refi. One was because the payment was going up, the other did not say. This refi would save over $400 per month. We would not be adding anything to our principle balance. My husband and I have credit scores of 780+ and have NEVER missed so much as a PG&E payment, let alone a mortgage.
I have 2 questions:
#1 are we likely to be denied....if so I fail to understand why.
#2 If we are denied, we have enough credit to write a check against a credit card. The bank doesn't seem to care about our debt, they just want to doccument it. Is this a reasonable option? Obviously if I had the cash to pay it off I wouldnt be paying $200 per month in interest on this loan.
Thanks to all who repply, this has been really stressing me out, not a lot of sleep lately.