Small mortgage balance refinance?

January 30, 2012 2:18 PM

I need help identifying a lender for a mortgage refinance on a small balance.

I'd like to refinance a balance of under $40,000 but find the larger familiar lenders do not accept anything less than $50,000. My bank suggested a HELOC instead and a couple other lenders suggested doing a cash-out refinance to increase the balance. Neither option is appealing to me as I simply want a standard 30 year fixed at the lowest rate possible and am willing to pay points to get it. Companies I have identified through bankrate.com... do not leave me with the best feeling. Does anyone have good experience with a lender for such a small balance? Location is Alabama.

(I can pay off the balance any time, this is a long-term interest rate arbitrage and short-term monthly cashflow move.)

posted by ferdinand.bardamu to Work & Money (1 answer total)

If it's interest rate arbitrage, then you getting more cash out should just benefit you more. Or you take cash out and pay the $10K down immediately. Although the latter option still leaves you with higher monthly payment and you'll be done paying your loan in less than 30 years.
posted by zeikka at 5:50 PM on January 30, 2012