The same principle applies to HELOC mortgages, where if a borrower does not have an outstanding balance on their HOME EQUITY LINE OF CREDIT, they can choose to close the HOME EQUITY LINE of credit and cancel the loan, which would completely eliminate the need for a subordinated arrangement. Despite its technically sounding name, a subordination agreement has a simple function. It assigns your new mortgage to the first lien position by granting permission to the second lien holder, which allows the existing mortgage to be refinanced. Under normal circumstances, a request for subordination usually takes about 3-4 weeks. Due to COVID-19, current processing times take between 6 and 10 weeks to enter into a subordination agreement. This is mainly due to the delays faced by second privilege holders, as most of their employees work from home and, as a result, most of their departments do not work at full capacity. The subordination agreement is usually provided by second creditors and solar energy suppliers. As a courtesy to our borrowers, Bluefire Mortgage Group enters into subordination agreements on behalf of the borrower, so that they do not have to deal with the additional paperwork that inevitably results from these documents. We want our clients to understand that due to these difficult times, they are prepared to face delays in the refinancing process during the finalization of the subordination agreement. Subordination agreements only apply to borrowers who have an open second lien. For example, if a borrower has solar energy, but it is in free and clear possession, there is no need for subordination.
At Bluefire Mortgage Group, we have a dedicated team that manages and manages subordination agreements on behalf of our clients. We are in constant communication with our clients and provide our borrowers with important updates every Tuesday during the refinancing process. The downside is that the borrower would no longer have access to their HOME EQUITY line of credit and would have to apply for a new HOME EQUITY line of credit again after completing their refinancing. .