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How Can We Find a Mortgage Company to Work With? – Susan

“Dear Steve,

My husband and I have a mortgage of approx. $78,000.00 on our home. We also have a home equity debt of $50,000.00. The mortgage is a 2 year ARM and is at 3.75% as of April 2009. Our home equity is a couple of points higher.

Our tax appraisal puts the value of our home at $276.000, 00 but we think it is quite high. We do not know what the appraisal value would really be. Our house does need some more work. My husband has spent the last month clearing and cleaning up the lot and making small repairs to the house.

We would like to combine the two debts into a 30 year fixed loan but our Credit Union no longer offers 30 year loans. We do not know who to trust in the current financial mess and are watching the interest rates rise as we try to decide what banks, mortgage brokers, etc. we should try. I am a teacher and our salaries are frozen. My husband is a carpenter and some weeks he has work and others he does not. We need to reduce the payments with a fixed loan and are anxious to get out of the 2 year ARM before the inevitable rise in rates happens.

How do we choose the correct financial institution for our mortgage? We are getting conflicting advice.


Dear Susan,

You can generally find more selection by working with a mortgage broker that represents a number of lenders or one of the online mortgage sites like LendingTree or Eloan.

The tax appraised value of your home means little to nothing. Tax appraisals are not based on the actual comparable sale price of your home and that is the true value. If you were to sell your house today, the amount someone is willing to pay for your house, is what it is worth.

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When you find a broker or site to work with and you move ahead with your loan they will send an appraiser out to determine what the fair market value of your home actually is.

I hate short ARM and 15 year loans. I always prefer a 30 year fixed loan since you can always pre-pay the loan if you want but it allows you to fall back to the regular 30 year payment instead of limiting yourself in a higher 15 year payment.

With current fixed rates on a 30 year mortgage, your monthly payment may go up. Your current interest rate is lower than fixed rate offers.


About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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