Selling is the ONLY option??

[Sang Yi]

Need some help on this matter.

My sister has a home in Torrance, CA. It's worth around 1.15mil. She has 245k left on mortgage plus around 100k equity loan she used for kids school. Around 18yrs left after last refinance for 4.50 interest. They both have excellent credit.

They have a small mom and pop store for nearly 20 yrs. They always never reported proper income. With the covid pandemic they were struggling till today but getting by.

They want to refinance only to lower mortgage with lower interest..no cash out.. But they can't do it without showing proper/qualifying income. They have a lot of equity but are they stuck? Only way is to sell??

[Bill B.]

They probably could refinance. They probably could just pay extra. They’re pretty far in to a relatively small mortgage. BUT. If the truly don’t make enough to qualify for a $245k mortgage, maybe they shouldn’t be living in a $1.1.million house? 

What if they sold and moved in to a $500k house? Pay off both the mortgage and the LOC and put $150k in their pocket, and have no mortgage left.