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Mortgage Rates (1 Viewer)
- Thread starter MechEng
- Start date
Random
Footballguy
Horrible advice. You will probably have to pay to get 3%. Why do that when you could take 3.25% to 3.50% for free? If/When rates dip again, refi (for free) again. I've been doing this for a year and a half now (actually getting enough of a lender credit to fund my escrow account in some cases), while a year ago my neighbor paid over $5K to get the rate I'm at now.
FavreCo
Footballguy
You go ahead and pay the higher rate. I'll take the lower one. I guess if I was refinancing a shack, I'd take the higher one.
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CrossEyed
Footballguy
Locked in a couple of weeks ago at 2.99% and the same bank is at 2.875% right now. No points.
FavreCo
Footballguy
Dude, you live in Sidney Ohio. My paved driveway is worth more than your whole house.'FavreCo said:
Random
Footballguy
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FavreCo
Footballguy
Glad I could teach you something. Amerisave is no better than anywere else. You still have to pay fees. Otherwise, I would be refinancing a loan that is barely below my current one. Thus not worth doing.When I run the numbers using your idea of paying a higher rate, I get my ### reamed in interest to the tune of more than my closing costs.
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FavreCo
Footballguy
Just ran 3 scenarios on Amerisave. $110000 loan plus all fees and rolling those fees into the loan at 2.75, 3.0 and 3.25. Guess which one is the best one. The lowest rate. No reason to do the 3.5% one.
Random
Footballguy
At first I thought you were just being ****, but it appears you simply dont understand. Of course the lower rate is going to be better today. You dont need to run anything for that to be true. But what about when rates drop again? And you paid $3500 today to get a rate that could very well be the free rate in 3 months or 6 months? You stated earlier that you were hoping for 2.5%, are you going to pay $3500 again if we get there in a week, month, or year?How much did you pay for the great rate you have now? How long have you had it?
Your BEP on a free refi is 0 months. I dont know how else to say it.
Johnny Rock
Footballguy
Gianmarco, how did you qualify for a refi with no appraisal? It appears your loan is only 2 years old so I'm thinking you don't qualify for HARP as it's only for loans that originated before (I think) June 2009. That's the pickle I'm in as my loan closed in August 2009, like anyone closing after May 2009 is immune to the housing problems in America. Are banks doing no-appraisal loans even for non-HARP loans?
FavreCo
Footballguy
You are banking on rates going down to zero. If this is the bottom, you lose. My current mtg has already covered the closing costs. I paid a few grand. Also your Ohio costs are less than my Florida costs. Tell me at what rate you are getting a free refi. I'll tell you that it isn't even 3.5%. According to Amerisave a 15 year is ~ 0% at 4.25%. I'm already there. So while I get a 2.875-3% loan, you are stuck at 4.25 and if this is the bottom, you will pay a lot more in interest than the few grand that I pay in closing costs.
In Florida, that 4.25% loan will cost about $930.
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gianmarco
Footballguy
I don't know but I can find out when we have our meeting and closing. But, the original loan was 4 yrs ago and the one above was a refi I did after 2 yrs. That original refi also didn't require an appraisal but it was also through the same mortgage company (BOA). This is a new company but they did state I didn't need one again.
Random
Footballguy
Nope, you are banking on catching the bottom. Right now, this is it. Good luck with that. My refi's:07/2004 5.25 30yr original pruchase11/2010 4.00 15yr $299 refi11/2011 3.625 15yr free refi03/2012 3.25 15yr free refiToday I could get 3.5% for free. Or I could pay $3500 for 2.75%. I'll refi again when I can get 3% free. If it never gets there, no big deal.
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Ned
Footballguy
Do you 2 have the same credit score and LTV?
FavreCo
Footballguy
There is no way anyyone in FL is getting 3.25% for free. Period. My credit score is high 700's. I'm not banking on catching the bottom. I'm hoping it stays low for another few months.
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culdeus
Footballguy
At some point the closing costs will be greater than the interest on a 30 year loan. That's when I'll laugh.
CrossEyed
Footballguy
If, at some point, we are laughing about sub 3% mortgages, I think we'll be crying about a lot of other things.
Johnny Rock
Footballguy
Congrats!
towney
Footballguy
With 0pts
wow....with who? What was your APR?With 0pts
xulf
Footballguy
Mine was confirmed via a Good Faith Estimate and a phone call, so I don't have the actual APR yet. I ended us paying .2 pts on it instead of taking the .8 pt credit for 3.75. We initially were going to have to pay .5 pt to get to 3.75 a couple weeks ago, so this waswow....with who? What was your APR?With 0pts
We used Fifth Third for our mortgage. Our loan guy locked us in b/c he felt the market was turning and rates started creeping up. Should have been more clear on the initial post, but did that via my phone.
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Dragons
Delusions of Grandeur
Do you have an FHA mortgage? As I said before, I'm in the same boat, but I have an FHA mortgage.I just checked and FHA streamline rates (no re-appraisal required) for a 5/1 ARM are 2.5% with $3500 in closing costs and 2.875% with no closing costs. A new upfront mortgage insurance premium will be added to the loan (1.75% of loan amount) and the ongoing monthly MIP rates are higher than they've been in the past.
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Isn't this financed though?
Dragons
Delusions of Grandeur
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Just making sure. I just got an offer accepted with 4k in closing. Using an FHA loan probably.
Sweet J
Footballguy
I locked into 30 year, 4.125% about a month and a half ago for my purchase that closes next week. A couple of weeks ago, I called the mortgage guy and said "hey, the rates are going down, can we redo this rate?" And he said no, that we locked in, and that is the best he could do. I then called my bank, and they said that they could give me a better rate, but that there is no way in hell they can do it by next week. I called him back and he told me that would approach the lender and ask them to give us a rate when we were ten days out (this past monday). He didn't answer his calls for two days, and then we got an email two nights ago saying: "the mortgage bond markets have been hit pretty hard the past three days. We will continue to ask each day." Last night we got these options:4.000% zero discount points3.875% 0.750 discount points3.750% 1.500 discount points3.625% 2.125 discount points3.500% 2.625 discount points3.375% 3.375 discount points3.250% 4.125 discount pointsI want to puke. So let me ask FBG: If some stranger off the street had called him up two weeks ago and asked for the best rate, he could have given the best rate, but because we had already "locked in" at 4.125, we were stuck with it? I hate myself.Mine was confirmed via a Good Faith Estimate and a phone call, so I don't have the actual APR yet. I ended us paying .2 pts on it instead of taking the .8 pt credit for 3.75. We initially were going to have to pay .5 pt to get to 3.75 a couple weeks ago, so this waswow....with who? What was your APR?With 0pts
Grahamburn
Footballguy
Nothing would ever get closed if both parties just changed their minds every time the rates fluctuated.I refinanced at 3.75% on a 20 year two months ago. Apparently I could have done a little better, but I'm glad to be done with the paperwork hassles. I shortened my term by 7 years and lowered my payment by $150 a month. Pretty happy camper.Be excited about your closing. Congratulations.
Sweet J
Footballguy
Thanks. Based on the chart above, does anybody have any suggestions about buying points?We could pay to get the points down to 3.25 or so. Is it worth it? I think the cost would be about 18,000, and would save maybe 250/month. I need to double check my numbers, but that sounds about right. On a straight calculation, that means we would recoup the payment in about 6 years. Is that right? What are the general thoughts about buying points?Nothing would ever get closed if both parties just changed their minds every time the rates fluctuated.I refinanced at 3.75% on a 20 year two months ago. Apparently I could have done a little better, but I'm glad to be done with the paperwork hassles. I shortened my term by 7 years and lowered my payment by $150 a month. Pretty happy camper.Be excited about your closing. Congratulations.
tommyGunZ
Footballguy
sounds like you're not stuck at 4.125, he's offering you 4.0 at zero pts, no?I locked into 30 year, 4.125% about a month and a half ago for my purchase that closes next week. A couple of weeks ago, I called the mortgage guy and said "hey, the rates are going down, can we redo this rate?" And he said no, that we locked in, and that is the best he could do. I then called my bank, and they said that they could give me a better rate, but that there is no way in hell they can do it by next week. I called him back and he told me that would approach the lender and ask them to give us a rate when we were ten days out (this past monday). He didn't answer his calls for two days, and then we got an email two nights ago saying: "the mortgage bond markets have been hit pretty hard the past three days. We will continue to ask each day." Last night we got these options:4.000% zero discount points3.875% 0.750 discount points3.750% 1.500 discount points3.625% 2.125 discount points3.500% 2.625 discount points3.375% 3.375 discount points3.250% 4.125 discount pointsI want to puke. So let me ask FBG: If some stranger off the street had called him up two weeks ago and asked for the best rate, he could have given the best rate, but because we had already "locked in" at 4.125, we were stuck with it? I hate myself.Mine was confirmed via a Good Faith Estimate and a phone call, so I don't have the actual APR yet. I ended us paying .2 pts on it instead of taking the .8 pt credit for 3.75. We initially were going to have to pay .5 pt to get to 3.75 a couple weeks ago, so this waswow....with who? What was your APR?With 0pts
Drop it to 4% for free and be happy. Why pay the $18k down now? I would bank that as a just in case, unless you have a ton more in cash/easily accessible in case of emergencies. I certainly wouldn't pay it down if you have any other debt (CC, cars, etc.) that is at a higher/non-tax deductible interest.Thanks. Based on the chart above, does anybody have any suggestions about buying points?We could pay to get the points down to 3.25 or so. Is it worth it? I think the cost would be about 18,000, and would save maybe 250/month. I need to double check my numbers, but that sounds about right. On a straight calculation, that means we would recoup the payment in about 6 years. Is that right? What are the general thoughts about buying points?Nothing would ever get closed if both parties just changed their minds every time the rates fluctuated.I refinanced at 3.75% on a 20 year two months ago. Apparently I could have done a little better, but I'm glad to be done with the paperwork hassles. I shortened my term by 7 years and lowered my payment by $150 a month. Pretty happy camper.Be excited about your closing. Congratulations.
xulf
Footballguy
Thinking of buying this down to 3.5%. Would cost an additional .625 pts which would be paid off in less than 7.5 yrs. Having a good commission yr at work, so the tax deduction would be nice.Mine was confirmed via a Good Faith Estimate and a phone call, so I don't have the actual APR yet. I ended us paying .2 pts on it instead of taking the .8 pt credit for 3.75. We initially were going to have to pay .5 pt to get to 3.75 a couple weeks ago, so this waswow....with who? What was your APR?With 0pts
Sweet J
Footballguy
Yeah, he did come down to 4.0, which is nice. My wife likes buying the points, because she likes having "less" money to have to pay each month. I think we would just borrow more in order to pay the points, which seems kind of weird to me. So if we didn't buy them, we'd just have 18,000 less that we are borrowing. I'm not sure I understand it (the virtue of buying points or not).sounds like you're not stuck at 4.125, he's offering you 4.0 at zero pts, no?I locked into 30 year, 4.125% about a month and a half ago for my purchase that closes next week. A couple of weeks ago, I called the mortgage guy and said "hey, the rates are going down, can we redo this rate?" And he said no, that we locked in, and that is the best he could do. I then called my bank, and they said that they could give me a better rate, but that there is no way in hell they can do it by next week. I called him back and he told me that would approach the lender and ask them to give us a rate when we were ten days out (this past monday). He didn't answer his calls for two days, and then we got an email two nights ago saying: "the mortgage bond markets have been hit pretty hard the past three days. We will continue to ask each day." Last night we got these options:4.000% zero discount points3.875% 0.750 discount points3.750% 1.500 discount points3.625% 2.125 discount points3.500% 2.625 discount points3.375% 3.375 discount points3.250% 4.125 discount pointsI want to puke. So let me ask FBG: If some stranger off the street had called him up two weeks ago and asked for the best rate, he could have given the best rate, but because we had already "locked in" at 4.125, we were stuck with it? I hate myself.Mine was confirmed via a Good Faith Estimate and a phone call, so I don't have the actual APR yet. I ended us paying .2 pts on it instead of taking the .8 pt credit for 3.75. We initially were going to have to pay .5 pt to get to 3.75 a couple weeks ago, so this waswow....with who? What was your APR?With 0pts
Sweet J
Footballguy
Answered just above, I think. We don't really have any other debt. And this home purchase is wiping out our savings. So maybe we shouldn't buy the points.
tommyGunZ
Footballguy
Figure out your break even point SJ. If you're saving $150 a month ($1800 a year) by buying the points, it would take living 10 years to break even if it cost you $18,000 up front. And really longer, since you're foregoing other beneficial economic opportunities with that 18k in the meantime. And remember, the average home turns over every 7 years now, so you don't want to buy pts if it's going to take 5-7 years to break even.
Sweet J
Footballguy
thanks
Dragons
Delusions of Grandeur
What was the rate quoted by the other bank? What are your closing costs? How long do you have to wait to refi? Is it cheaper to refi and get to 3.5 than to buy $18,000 in points? (my guess is a resounding yes, if it's available to you before rates go up)ETA - don't refi through your current mortgage guy. #### him.ETAA - not because he couldn't lower the rate, that's the norm, but because he didn't answer your calls for 2 days when closing is so close.
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Dragons
Delusions of Grandeur
I don't know the accuracy, but I found this link.
Maybe you should involve your current broker, if only to just to confirm there are no prepayment penalties on the current loan. If that link is true, and a bank will lose money if you refi quickly, he may take some kind of hit if you do. He may be more inclined to find an extra rate discount if he thinks you'll be refinancing immediately.
Maybe you should involve your current broker, if only to just to confirm there are no prepayment penalties on the current loan. If that link is true, and a bank will lose money if you refi quickly, he may take some kind of hit if you do. He may be more inclined to find an extra rate discount if he thinks you'll be refinancing immediately.
BigJim®
Footballguy
I went ahead and called Wells about refinancing my 20 year/4.75% and was told I could get 3.25 with zero points on a 15 year loan. They said there would be $3400 in closing costs. No biggy I figured, it's paying 2 months of payments to remove nearly 4 years from my loan, and figured I'd just pay cash. However, I just got the good faith estimate packet in the mail and it has $6314.14 in the "Total Estimated Settlement Charges" box. That can't be right, can it? What sort of closing costs should I be expecting for this sort of refi on a <> $200,000 loan?
Dragons
Delusions of Grandeur
Do the estimated settlement charges include anything that will be going into escrow?
BigJim®
Footballguy
Yes, it has $2652 initial deposit for escrow account (taxes, insurance). I'm not following this. When I did the prior stream-lined refi (i.e. Obama plan refi) 14 months ago, I recall they just discontinued one escrow, moved what was contained in it to the new escrow, and think I continued funding the new escrow with increased monthly payments. They appear to have this $2652 calulated into my new loan amount since the "Your initial loan amount" field is roughly $6000 more than I owe today.
Dragons
Delusions of Grandeur
Are you rolling your closing costs into the new mortgage? I'd think rolling the escrow amounts into the new mortgage would be considered a cash out refi. Are you doing a cash out?In a streamline refinance, they may just move the escrow account over, but more likely your streamline was with the same bank, thus making it easier. Generally, you'll get a credit for your old escrow account and you'll pay into the new one. It'll all wash at closing (i.e. your true closing costs will be $6000 less the $2652 escrow prepayments, because that will be funded by the old escrow account).Is the amount you owe today the actual amount you owe, or is it some kind of payoff calculation? Sometimes they'll reduce the amount you owe by the amount you have in escrow.You should talk to the wells fargo agent for clarification.
BigJim®
Footballguy
Thanks for the info. No, I didn't plan to do a cash out. I got my current loan amount at wf.com - it shows as one of my accounts with the current balance. My plan was to pay closing costs and appraisal in cash, thinking I'd owe no more on the loan. However, I wasn't planning to pay, and ceretainly not finance over 15 years, $6200 to take advantage of a 0 point refi. Even the quoted $3400 struck me as a lot to process refi paperwork.'Dragons said:
