I have recently been shopping around to see if I could get my home refinanced. I purchased in Oct. 2007 for $200,000 - 30 year fixed at 5.99%.
I called my lender and they were willing to refinance at 4.875% for 20 years, or 5.125% for another 30 years. Even though I bought the last house in the neighborhood for at least $100k cheaper than every other house in the neighborhood, I don't think the appraisal will come in high enough to get the right LTV ratio. I think the lender wanted 97.5% or something like that.
Additionally I have a car that I have had to start commuting for a new job in, so I have put a ton of miles on it, and thus it is underwater for the value. I owe about $14k, and I could probably get $10k out of it.
I switched jobs last year and I currently have about $20,000 in a 401k that is just sitting there that I never have rolled into my currently 401k.
I guess my question is - since it doesn't seem like I can refinance in my current situation, should I:
put that 401k money into either paying the car off ASAP, so that I could then start paying my "car payment" into principal on my house loan,
put the 401k money into the house to try to get the loan-to-value (LTV) ratio (I expect an appraisal might come in at 180k, and the loan amount is down to $194k-ish right now),
do nothing, pay the car off on schedule and then start trying to put money into the house when the car is paid off in 3 years, or
open to suggestions.
Additional facts: The new job I am at my income is at $96,000/yr presently, with a good 401(k) plan, in which the company is putting in 10%, and I am putting in 4% for a total of 14% going into my new plan. I am 27.