Refinance 1st Mortgage, Leave HELOC In Place?
Has anyone ever refinanced the 1st mortgage (rate/term - no cash out) while leaving the 2nd position HELOC in place? Can this be done? Are HELOCs "subordinatable" by default?
-JohnCl
[ Edited by JohnCl on Date 08/25/2006 ]
John,
Once the first is paid off the second will move into first position, unless you can get the HELOC lender to suborinate their postion to the first, which can be done.
Tell the lender you want to use to refinance about the current situation and they will provide the paperwork to the HELOC lender concerning subordination to them.
John $Cash$ Locke
[addsig]
John,
Thank you for your answer.
Is this the sort of thing I should pass off to the closing attorney to take care off? In other words, as long as everything closes correctly with the attorney is there any reason the new primary lender would want to know or care what is subordinated to it? The reason I am asking is because the HELOC is for a pretty good amount. Add the closing costs with the new underlying financing and CLTV is around 100%.
-JohnCl
John,
Your attorney will be able to handle this and the primary lender will not care as long as their first position is secured.
John $Cash$ Locke
[addsig]