In at the height of the sub-prime mortgage fiasco, Chase Home Finance loaned me $464,000 to purchase a new home in Redondo Beach, California. This was a stated-income loan and required little or no documentation to qualify. I made a 20-percent down payment on the purchase price of $580,000 and received a 7/1 adjustable-rate, interest-only mortgage at 5.375%. The monthly payment was $2,046. For much of the the time, I've prepaid toward the principal, however, and sent them monthly checks for $2,600. The balance of the loan now stands at $454,000. Now, six years later, we're approaching an almost inevitable rising interest-rate environment. However, Chase Home Finance won't allow me to refinance this booby-trapped loan. The appraised property value has fallen by about $80,000, leaving me with less than 20-percent equity in the home. Additionally, like all banks, Chase has vastly increased the level of income documentation required to qualify for a refinance.
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