This is the second time we have worked with the Moreira Team and we are more impressed the second time around than we were the first! The first time we were so impressed with the ease of working with Tim Endress and his team that we recommended them over and over again to many people.
They say fine wine gets better with age. Well this team just keeps improving on the quality of their service and we could not be more pleased. We highly recommend them if you are looking for a mortgage lender, they are the best and the process is so easy and stress free. Tim, Stacey and Amanda, you rock the house, so to speak.
Thank you all for making this a headache free process.
The Client
Our client wanted to payoff high interest credit cards to increase monthly cashflow and pull extra cash for a rainy-day emergency fund.
- Loan Type – Refinance
- Program – Debt Consolidation / Cashout
- Loan Amount – $337,500
- Starting Rate – 3.75%
- Starting Payment – $1,563
- New Rate – 3.25%
- New Payment – $1,469
- Cashout – $42,523
Client Requirement
Using the equity in home due to appreciation, the client wanted to cashout from her home to consolidate high interest credit card debt and start a rainy-day emergency fund. She wanted a much lower, fixed rate and wanted to keep her overall closing costs low to maximize her cashout. The goal was to try and save as much as possible per month by increasing cashflow through a debt consolidation. She wanted to do that by leveraging the equity in the home to restructure her debt and get into a better overall mortgage.
Loan Challenges
The big obstacle to overcome on this deal was making sure the client could qualify based on her retirement income benefits and debt to income ratio after paying of the debts. The other big issue was to make sure there was enough equity in the home to go up to the cashout limit of 80% loan-to-value.
The Challenges
- Get the client qualified based on her current retirement income.
- Make sure there was enough equity to qualify for the max cashout amount of 80% LTV.
- Ensure we could get a high valuation on a new appraisal using recent home sales that have gone up.
Our Solution
We pulled an AVM (Automated Valuation Model) on the property to determine upfront that the value was what we needed and there were recent sales in the area to support the value we needed. We then structured the loan, assuming certain debts would be paid off, so that the make the debt-to-income ratio would work. Once we had the approval in hand, we shopped for the best rate against our group of partner lenders to secure the financing for the Debt Consolidation/Cashout Refinance.
The Results
Even though the monthly payments on the mortgage only went down slightly our client was able to eliminate almost $556 dollars a month of other high interest debt. She will also be saving almost $47,259 in interest savings during the lifetime of his new loan. She was also left with over $19,000 in cash to use towards her rainy day/emergency fund We were able to get all this accomplished in less than 22 days.
- Client was able to pay off $28K worth of debt and still had $19K left over for savings.
- The low rate we secured allowed her to save $47,259 in interest compared to her original loan.
- She was able to save a total of $556 total per month by paying off all her debt and her payment went down $94.
- We closed in 22 days from our initial phone call.
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