Kendall Coffey

Kendall Coffey

Kendall Coffey is a partner at Coffey Burlington, whose state-wide practice includes complex litigation at the trial and appellate levels. He has authored numerous legal works ranging from “The Due Process Right to Seek Asylum” in the Yale Law and Policy Review to the recently published treatise “Foreclosures in Florida.” As the former U.S. Attorney for the Southern District of Florida, he headed one of the largest federal prosecution offices in the country. Mr. Coffey received his undergraduate and law degrees from the University of Florida.

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Question:

If a person that is already a mortgagor of a bank elects to refinance with the same bank but his income has decreased significantly, is he running the risk that the refinance be denied and his original mortgage called for the bank "feeling insecure".?
Thanks
Cesar

Answer:

In theory, yes, but if the mortgagor has been consistently on time and otherwise current with the mortgage obligations, it would be a very slim basis for insecurity. To make a strong case for declaring a default based on insecurity, the existing lender would have to be able to point to an income so reduced that there is realistic concern that future payments will not be made.