Lot split financing and impacts on existing mortgage:

[Abraham Gebrezgiabhier]

Currently I own a property in Sacramento with enough backyard lot that has Alley access and my current Mortgage is at a 2.5% rate and don't want to touch or affect it.

I am in the process of considering a lot split with a plan to build a new doublex unit in the split lot with hard money or a construction loan. 

The plan is to refinance the new unit separately immediately after completion and pay back the loan. 

My question is does the lot split affect my current mortgage? Am I required to refinance my current mortgage if I split the lot?

[Chris Seveney]

Quote from @Abraham Gebrezgiabhier:

Currently I own a property in Sacramento with enough backyard lot that has Alley access and my current Mortgage is at a 2.5% rate and don't want to touch or affect it.

I am in the process of considering a lot split with a plan to build a new doublex unit in the split lot with hard money or a construction loan. 

The plan is to refinance the new unit separately immediately after completion and pay back the loan. 

My question is does the lot split affect my current mortgage? Am I required to refinance my current mortgage if I split the lot?

 They may require you too. They will not allow the split to be recorded as it will impact the title on the property and devalue the property. If you split it they may want to amend to still include both parcels. Then you would need to work with them to allow you to then sell it and pay down the existing and confirm the home you keep still has equity. It is painful to do this even with lots of equity as it is not "bread and butter" for a bank.

[Scott Scoville]

Quote from @Abraham Gebrezgiabhier:

Currently I own a property in Sacramento with enough backyard lot that has Alley access and my current Mortgage is at a 2.5% rate and don't want to touch or affect it.

I am in the process of considering a lot split with a plan to build a new doublex unit in the split lot with hard money or a construction loan. 

The plan is to refinance the new unit separately immediately after completion and pay back the loan. 

My question is does the lot split affect my current mortgage? Am I required to refinance my current mortgage if I split the lot?

I'll be following this. I have a duplex on a double lot that I'm considering the same thing in Sacramento.