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rated:
I recently inherited a house which is now my primary residence. It has 19 years existing on a mortgage. 

Since I'm fairly new to homeownership, I'm wondering what others would recommend I do. Should I add an extra $680 (this is what I can comfortably afford) to my payment per month and pay off the loan in 8.5 years? Or, since the house is old and needs updating (kitchen hasn't been touched much since the 50s, shower needs to be redone), should I refinance to take $50k out and extend the loan to 30 years? 

I'm not sure if there's a right answer, but how would you all go?

Thanks for any advice.

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i would go with HELOC or fixed Home Equity Loan. If you refi - remember you'll have about few thousands worth of closin... (more)

prozario (Feb. 27, 2017 @ 1:28p) |

Refi. Based on the rates you get, you maybe able to afford a 10 or 15yr.

rsuaver (Feb. 28, 2017 @ 11:46p) |

This seems like a very odd "this or that" decision.

1) Accelerate payments on the house
-or-
2) Cash out refi to renovate/... (more)

Dus10 (Mar. 01, 2017 @ 7:24a) |

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rated:
What interest rate is the existing mortgage?

Who's name is the mortgage in?

rated:
refi

rated:
depending on what you've got saved and what your plans for the house are, you could also not refi and instead pay cash for the updates as money becomes available

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jerosen said:   What interest rate is the existing mortgage?

Who's name is the mortgage in?

  Existing rate is 3.75 and it is now in my name. 

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damastaodisasta said:   depending on what you've got saved and what your plans for the house are, you could also not refi and instead pay cash for the updates as money becomes available
  Estimated costs for a new kitchen (cabinets, appliances, floors and backsplash) and to redo one of the bathrooms is around $40k. I don't have that saved up that's why I'm considering a refi.

rated:
That's a pretty good rate. Are the updates things that you can get by without, as in not safety or structural repairs? If so, I would keep the 3.75 mortgage and put the extra into a house fund, do repairs/updates as you can afford them.

rated:
You could also consider a HELOC (if you have enough equity) to fund the renovation. But do this only if you have a good plan to pay off the balance in a short period of time. HELOC rates are variable and they could creep up soon.

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psychoslowmatic said:   That's a pretty good rate. Are the updates things that you can get by without, as in not safety or structural repairs? If so, I would keep the 3.75 mortgage and put the extra into a house fund, do repairs/updates as you can afford them.
  This is what I'm leaning towards. The kitchen is functional. It's not pretty, but everything works. I probably should at the very least redo the shower, but that I can go out of pocket now. Thanks for your advice. 

rated:
fwuser12 said:   You could also consider a HELOC (if you have enough equity) to fund the renovation. But do this only if you have a good plan to pay off the balance in a short period of time. HELOC rates are variable and they could creep up soon.
  I like the idea of a HELOC working as a revolving account but I don't like the adjustable rate which is why I want to do a refi. Thanks for your advice. 

rated:
PaulBanks said:   
fwuser12 said:   You could also consider a HELOC (if you have enough equity) to fund the renovation. But do this only if you have a good plan to pay off the balance in a short period of time. HELOC rates are variable and they could creep up soon.
  I like the idea of a HELOC working as a revolving account but I don't like the adjustable rate which is why I want to do a refi. Thanks for your advice. 

  if you want a fixed rate, there are HEL

rated:
You said the Mortgage is 'now in my name' , usually mortgages require you to 'refi' it into your name.

That's why I'm asking. You sure about that?

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Depending on how you're doing your renovation and how much, a credit card with 0% APR for 21 months like Citi may work.

rated:
Good area = refi with minimal cashout. Bad neighborhood sell & be on your way.

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Before you go spending $40k on renovations, consider the value of comparable homes in the neighborhood and if you will get $40k worth of value out of $40k worth of renovations. We just redid our kitchen and master bath for around $22k. If we spent much more than that, it would have been too nice for our neighborhood and the type of home we have. My house could have probably sold for $180k before and we should be able to get $205k now. We paid cash for both renovations. How much would yours go for without the renovations?

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forbin4040 said:   You said the Mortgage is 'now in my name' , usually mortgages require you to 'refi' it into your name.

That's why I'm asking. You sure about that?


I was wondering about that too. You can inherit a house but I didn't know you could inherit a mortgage.

rated:
kriskos4 said:   
forbin4040 said:   You said the Mortgage is 'now in my name' , usually mortgages require you to 'refi' it into your name.

That's why I'm asking. You sure about that?


I was wondering about that too. You can inherit a house but I didn't know you could inherit a mortgage.

  
Some mortgages are assumable such as FHA but it still requires a formal process to determine the creditworthiness of the new borrower.  I never actually did one in my loan officer history since the market trended downwards but it could be valuable in raising interest rate market assuming the right conditions are met. 

rated:
meade18 said:   Before you go spending $40k on renovations, consider the value of comparable homes in the neighborhood and if you will get $40k worth of value out of $40k worth of renovations. We just redid our kitchen and master bath for around $22k. If we spent much more than that, it would have been too nice for our neighborhood and the type of home we have. My house could have probably sold for $180k before and we should be able to get $205k now. We paid cash for both renovations. How much would yours go for without the renovations?
  The house is valued at $580k but the house directly behind us just sold for $670k. It has an extra bedroom, but we have a bigger yard and pool. My thought was by doing a middle to higher end upgrade, we could bring the value up to $650k. However, it doesn't really matter. We're not trying to sell. This house is nicer than any apartment we could afford so the plan is to stay here for the long run. 

rated:
bpp said:   
kriskos4 said:   
forbin4040 said:   You said the Mortgage is 'now in my name' , usually mortgages require you to 'refi' it into your name.

That's why I'm asking. You sure about that?


I was wondering about that too. You can inherit a house but I didn't know you could inherit a mortgage.

  
Some mortgages are assumable such as FHA but it still requires a formal process to determine the creditworthiness of the new borrower.  I never actually did one in my loan officer history since the market trended downwards but it could be valuable in raising interest rate market assuming the right conditions are met. 

  My bad. The title is in my name. Not the mortgage itself. However, my credit is in the 800s and from the online calculators I've tried, I can afford a refi with $50k out. 

rated:
Having a pool is like having a Boat. You are happy two times of it's life, when you first get it, and when you sell it.
Pools are such fun to maintain for little use.  So when you sell it, that pool is going to fetch you good value.

rated:
Refi

rated:
PaulBanks said:   
bpp said:   
kriskos4 said:   
forbin4040 said:   You said the Mortgage is 'now in my name' , usually mortgages require you to 'refi' it into your name.

That's why I'm asking. You sure about that?


I was wondering about that too. You can inherit a house but I didn't know you could inherit a mortgage.

  
Some mortgages are assumable such as FHA but it still requires a formal process to determine the creditworthiness of the new borrower.  I never actually did one in my loan officer history since the market trended downwards but it could be valuable in raising interest rate market assuming the right conditions are met. 

  My bad. The title is in my name. Not the mortgage itself. However, my credit is in the 800s and from the online calculators I've tried, I can afford a refi with $50k out. 

So you're just continuing to make the payments to a loan in the name of the deceased?  If the terms of the loan were drastically better than what you could get on your own, maybe I'd consider letting it ride until they figure out that the borrower is deceased, but in your case, I'd recommend that you get it all straightened out.  Pay off the existing loan, be sure to get a release of the prior lien recorded, clear title, etc., and get your own loan on the property along with any cash out that you want.  Better to clear all that up now rather than wait until the lender discovers that the original borrower is deceased and you have to refinance under unfavorable terms, or you try to sell and realize that there is a clouded title because of something you should have done years ago.  

rated:
dcwilbur said:   So you're just continuing to make the payments to a loan in the name of the deceased?  If the terms of the loan were drastically better than what you could get on your own, maybe I'd consider letting it ride until they figure out that the borrower is deceased, but in your case, I'd recommend that you get it all straightened out.  Pay off the existing loan, be sure to get a release of the prior lien recorded, clear title, etc., and get your own loan on the property along with any cash out that you want.  Better to clear all that up now rather than wait until the lender discovers that the original borrower is deceased and you have to refinance under unfavorable terms, or you try to sell and realize that there is a clouded title because of something you should have done years ago.  
  
This^^^

Any thanks for answering my post above. $40k worth of renovations for a house with that value in a neighborhood with similar values definitely makes sense, especially if you plan on living there and want to enjoy your kitchen and bathroom.

rated:
i would go with HELOC or fixed Home Equity Loan. If you refi - remember you'll have about few thousands worth of closing cost - not worth it, if all you need is $40K. Heloc/Fixed Home Equity loan wont require the closing cost.

rated:
Refi. Based on the rates you get, you maybe able to afford a 10 or 15yr.

rated:
This seems like a very odd "this or that" decision.

1) Accelerate payments on the house
-or-
2) Cash out refi to renovate/repair the house

So, you wouldn't renovate/repair the house if you paid it off? Or would you later get out a mortgage to finance the repairs?

How about keep the mortgage and pay as normal, then use your extra cash to renovate/repair?

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