We are looking to refinance our house the lender suggested that we combine the house and our cars for a low?

Eddie
3.9%. I told him that I was concerned because I would be paying on my cars for much longer then I had to. The lender told me we could do what is called a streamline mortgage. What is streamline mortgage and how would it work in our situation?

Shirl
Make sure your automobiles are not considered COLLATERAL for this loan. If so, then if you defaulted on the loan, you not only jepordize your home, you risk your automobiles as well. I would NEVER add my autos to a 30 yr mortgage at ANY rate because you are converting a short term debt (even if it is at a higher rate than the refinance rate) and turning it into a long term debt. The lender has likely suggested this method in order to reduce your debt to income ratio for the sake of qualification. IF you elect to take your lender's advice, and IF the autos are considered collateral, are you allowed to sell the vehicles would be my next question? I'm a Realtor but, I have been out of the biz for approx 2 years so, I'm not 100% what a stream line loan is but, I would have to guess that it is the type of loan that allows you to cash out all of your equity and pay off existing debt which makes reducing your not a bad idea depending on your situation. Persoanlly, I would assess my financial situation then I would first ask myself how long I intend to live in my current home. I would less likely take this route if I was finacially secure and if I intended to stay in my home for 30 years. However, only you can decide what is best for you and your family. It is my opion that your equity is something that you earned therefore, you have every right to spend it however you choose to and if paying off your automobiles is what you want or need to do, then do it, just be smart about it. Meaning, don't do it if you forsee this as an opportunity to get further into debt. Good luck and I wish you and your family the very best.

Jaimie
Doing a streamline mortgage does not alleviate your concern - you are still extending the car payments out over the length of the new mortgage.Basically a streamline mortgage speeds up the application process by reducing paperwork and the underwriting process - it has nothing to do with terms or anything else.In my opinion, you have the correct outlook on this - why tie your house to your cars or vice versa if you don't need to. Nice rate, btw.

Audie
First of all, 3.9% seems pretty low, even in these times. I would get that in writing.Second, you are correct in realizing that if you are taking out a 30 yr mortgage and you roll your car loans into it you are essentially financing those cars for 30 years. If you can afford the car payments without rolling them in, it doesn't make sense to put them in with the mortgage. Think of it this way: Let's say the house mortgage is $150K, and you have 2 cars with $10, 000 balances each on them that you have 4 years of payments remaining. Right now your total debt is $170K (The $150K for the house plus the two cars at $10K each). Put that all on one mortgage and in 4 years your debt will be $154, 713, the balance on the mortgage after 4 years of payments. If you just did the mortgage for the house alone, at $150K, in 4 years the house mortgage balance will be $136, 511. Plus, you will have paid off the two cars as you are continuing to make payments on them. Now, the difference in your monthly mortgage payment between the $150K mortgage and the $170K mortgage is only about $100 per month, considerably less than what you are paying for 2 car payments right now. So that is ultimately what you need to decide as far as what is best for you. If the lower monthly payment overall is better for you then you may want to roll the car payments in. But if you can handle the car payments on their own you may not want to roll them in, as doing so will leave you with a substantially higher mortgage balance if you choose to sell your house in 5 years or so.

Sterling
Do you mean fold your auto loan balances into the refi loan? That can make sense in some cases if you have enough equity in your home. But you are adding that new debt (the auto loans) to your mortgage - so think hard about it first.