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Refinance Purchase Home Equity

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Fixed ARM Interest Only FHA

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Can I Refinance My Adjustable Rate Mortgage At 120% LTV?

By Kevin Landis

What is LTV and is 120% Possible?

When applying for a mortgage or refinance you may see the letters LTV at the end of the lenders advert or lending criteria, this means Loan To Value.

Before the credit crunch the loan market saw many people take up the opportunity to take out home loans and mortgages at 120% LTV, even without a deposit from the mortgagee. Banking and creditor attitudes have changes since 2007/08 due to the struggles that banks and financial sectors have gone through with the breakdown of ‘Sub-Prime’ Mortgages.

At the moment it seems that acquiring a loan to refinance any adjustable rate mortgage at 120% LTV is going to be a very hard task. Banks and other lenders are just not willing to lend on those terms anymore. Even the bad credit lenders are currently not facilitating any refinance packages at 120%. So if you do find a lender that is prepared to negotiate a refinance on your property at 120%, you will need to ask yourself a couple of questions:

Is it ethical to be offered a loan at 120% LTV?

Am I risking my home if I take out a refinance on my adjustable rate mortgage at 120% LTV?

Current Lending % LTV

Many banks and lenders are more willing to work with customers at between 70% and 85% LTV, and lending criteria has been tightened, although any personal circumstances like poor credit ratings will be considered in an application.

There have been some lenders that have been known to offer 95% LTV, but if you do find any refinance on your adjustable rate mortgage at 120%, you will really need to weigh up the risks involved with such a loan facility, it would be better to take a trip to your bank or a financial advisor to see just what is the best way forward for yourself and your circumstances.

Related posts:

1. How Soon Can I Refinance An Adjustable Rate Mortgage?
2. Who Sets The Margin For An Adjustable Rate Mortgage?
3. Should I Refinance An Adjustable Rate Mortgage?
4. Should I Refinance my Adjustable Rate Mortgage Now?
5. Is It Time to Refinance Your Adjustable Rate Mortgage?