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MechEng

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On 1/24/2020 at 10:34 PM, Chadstroma said:

#24: Always get an inspection done from a good inspector. Do not skimp here. A good inspector will give you very important info on the home even if there is nothing to be concerned over and potentially catch a very big problem. Keep in mind even the best inspectors will not be able to find out anything and everything wrong with a house. Find out of they do mold and radon testing or not and if it is extra if they do. I would go ahead and do it. Keep this in mind, this is usually the largest financial transaction of your life so far. Do you want to be penny wise and dollar foolish on it?

Here is why... I touched base with a past potential client yesterday. He ended up buying a house and now there is some significant regret. I don't even know about the loan he got, the regret was that he purchased a home and did not get a home inspection done. Apparently, there is a significant mold issue with the house and he is now contemplating whether to walk away from the house and take a hit to his credit or sell at current value losing what he expects to be about $15K. (I think he purchased for somewhere in the $50-60k area) A good home inspection can not find all potential issues with a home but there would have been a good chance that a good inspection would have found this issue or at least warning signs. I always strongly encourage EVERYONE to get a full home inspection from a qualified inspector. Do not skimp on a few hundred dollars when thousands (hundreds of thousands!) are at stake!

Best advice ever. You can overcome a slightly higher rate when you first buy a home, you can fix interior wall colors, you can fix a lot of things but the inspection report will point out things you don't see and things that are very important when you negotiate a purchase and sometimes no amount of discount or under market will make you want to buy it and you can walk away. 

Owning a home is expensive and if you are not handy or a Mr Fix-It then it's going to cost you a lot of money every time something breaks and you have to hire others to fix it. 

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1 hour ago, tommyGunZ said:

almost 7 years into a 30yr fixed at 3.75.  Worth my while to refi @Chadstroma

In a similar place with my mortgage. 8 years into a 30 yr @ 3.875. 

I think I’ve paid enough front loaded interest that it’s not worth refi-ing, but I’m not sure. 
when I look at refinancing to a 15, for example, I can’t get the interest rate low enough to keep it close to my current payment, and I don’t believe that extending my mortgage another 8 years when I’m almost a third of the way thought is the "right call". Hopefully Chad will weigh in with some advice here. 

in the meantime, I’m adding 20% more to my monthly payment to knock ~6 years off the length of the loan (I’ll be a million years old by the time this thing is paid off)

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7 hours ago, joey said:

In a similar place with my mortgage. 8 years into a 30 yr @ 3.875. 

I think I’ve paid enough front loaded interest that it’s not worth refi-ing, but I’m not sure. 
when I look at refinancing to a 15, for example, I can’t get the interest rate low enough to keep it close to my current payment, and I don’t believe that extending my mortgage another 8 years when I’m almost a third of the way thought is the "right call". Hopefully Chad will weigh in with some advice here. 

in the meantime, I’m adding 20% more to my monthly payment to knock ~6 years off the length of the loan (I’ll be a million years old by the time this thing is paid off)

In these situations just pay more principal. 

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8 hours ago, tommyGunZ said:

almost 7 years into a 30yr fixed at 3.75.  Worth my while to refi @Chadstroma

Most likely. I am looking at moving some clients into 15 yr sub 3% and keeping their payments near that what they had with their old loans. 

You could go 20 yr and get a smaller payment and knock off a few years or payments or if cash flow is more important do another 30. 

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8 hours ago, joey said:

In a similar place with my mortgage. 8 years into a 30 yr @ 3.875. 

I think I’ve paid enough front loaded interest that it’s not worth refi-ing, but I’m not sure. 
when I look at refinancing to a 15, for example, I can’t get the interest rate low enough to keep it close to my current payment, and I don’t believe that extending my mortgage another 8 years when I’m almost a third of the way thought is the "right call". Hopefully Chad will weigh in with some advice here. 

in the meantime, I’m adding 20% more to my monthly payment to knock ~6 years off the length of the loan (I’ll be a million years old by the time this thing is paid off)

What I would look to do in your case would be a custom term. Do a 22 yr term so your amortization is same but with a lower rate. Then you would be out of excuses. 😉

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48 minutes ago, culdeus said:

In these situations just pay more principal. 

Nah, you have choices. A 20 yr term would almost certainly keep his payments in his range but if not I have a lender (most every broker should be using the same lender, they are the largest and IMO best wholesaler) that does custom rates. 

If you are high 3's and above now is a great time to look at options. 

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Just signed the prelim paperwork on a refi last week.  Wife started looking around and realized the rates were in the mid-high 3's so she called the bank and started the ball rolling.  We just bought this house in late 2018 at 5% for 30 years.  Now we're locked in at 3.75% for a 25 year, and the monthly payments go down $50.   Closing costs get rolled in, we just pay $500 at signing.  And since we just had an appraisal in late 2018, a new one isn't required for the refi so saved that $ too. 

I'll shave 4 years off the note all day every day

Edited by wlwiles
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19 minutes ago, NutterButter said:

I just made my first payment on a my 30 year 3.625 refi.   Am I eligible to refi again if the numbers make sense or do I need to wait a certain amount of time?

I would just pay more principal 

I'm at 3.5

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6 minutes ago, wlwiles said:

Just signed the prelim paperwork on a refi last week.  Wife started looking around and realized the rates were in the mid-high 3's so she called the bank and started the ball rolling.  We just bought this house in late 2018 at 5% for 30 years.  Now we're locked in at 3.75% for a 25 year, and the monthly payments go down $50.   Closing costs get rolled in, we just pay $500 at signing.  And since we just had an appraisal in late 2018, a new one isn't required for the refi so saved that $ too. 

I'll shave 4 years off the note all day every day

Bank = no no. 

Let me hook you up with a broker to compare. You can thank me later. 

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29 minutes ago, NutterButter said:

I just made my first payment on a my 30 year 3.625 refi.   Am I eligible to refi again if the numbers make sense or do I need to wait a certain amount of time?

Technically yes. 

If it was a bank or direct lender- go for it. 

If you used a broker, keep one thing in mind... we make our living off of one thing. You doing your loan. Most loans have an EPO (Early Payoff) arrangement that if you pay off the loan before making 6 payments then the lender will take back the commission that the broker got. Meaning, they just did all that work for free. So, keep that in mind for your local neighborhood broker and be kind... if you went to a broker in the first place, it is likely rates in one month are not going to be ALL that huge to refi again. If you went to a bank or other retail lender, then you don't have to worry about the EPO and head to your nearest friendly neighborhood broker and they can help. 

ETA: If you are in a government backed loan, there are some different rules involved on whether you can do a streamline or not. 

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11 minutes ago, need2know said:

I would just pay more principal 

I'm at 3.5

It all depends. There are WAY too many factors involved in deciding if it makes sense to refi or not. The longer you plan on staying in the property, the more the rate drops, the smaller the amount of costs and the further it gets you to your goal (more cash flow or more savings) then the stronger the argument is to refi. There are no hard yes and no based on pure rates. I have seen too many people over my 20 years of dealing with people and their finances that they get some ridiculous idea in their head about how much you have to lower rate to make it make sense. SO many people have pieces of info or half truths or misunderstand a concept and take it as gospel and then make bad financial decisions. Talk to a pro that isn't a scum bag and make an informed decision. 

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3 minutes ago, Chadstroma said:

Technically yes. 

If it was a bank or direct lender- go for it. 

If you used a broker, keep one thing in mind... we make our living off of one thing. You doing your loan. Most loans have an EPO (Early Payoff) arrangement that if you pay off the loan before making 6 payments then the lender will take back the commission that the broker got. Meaning, they just did all that work for free. So, keep that in mind for your local neighborhood broker and be kind... if you went to a broker in the first place, it is likely rates in one month are not going to be ALL that huge to refi again. If you went to a bank or other retail lender, then you don't have to worry about the EPO and head to your nearest friendly neighborhood broker and they can help. 

ETA: If you are in a government backed loan, there are some different rules involved on whether you can do a streamline or not. 

It was lenderfi which I believe is a direct lender.   Thank you for all the time you're putting into helping all of us out.   

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Thanks to the virus there is a huge sell off in stocks which means mortgage rates are going down even more. Get moving guys! This is not a drill!!!

I am prob going to be too busy to jump back on today... if you want me to connect you with someone in your state (other than Illinois because then it would be me) email me... cmasters@marketplacemortgage.com, let me know what state you are in and your contact info and I can forward it to someone I know for you to reach out. 

 

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2 minutes ago, NutterButter said:

It was lenderfi which I believe is a direct lender.   Thank you for all the time you're putting into helping all of us out.   

Yea, screw the b-tards.😄  Get in touch with a broker, let me know if you need help finding a true broker. 

(their models are different so EPO do not impact them like it does a broker anyways) 

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Have a little less than 1.5 years left on a 5-1, 2.85 ARM from a CU. Estimated equity is 150k on a primary residence with my estimated market around 370k (Zillow says 399k). Not included is a 43k HELOC (opened 2019, different CU) from which I've taken out 20k for some updates.

So, considering a refi in the near future, before my rate goes up.

@Chadstroma got any contacts in New Hampshire you'd like to recommend?

Thanks for being so generous with your time in this thread!

 

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On 1/25/2020 at 12:37 AM, Getzlaf15 said:

All of this, and x10 on new construction.     I typically find at least twice as many items to fix on new construction than I do on existing homes.

WCI-Lennar is building our new home. They just started 3 weeks ago. We will be closing probably in July sometime. We are no doubt getting a top home inspector for our walk through before we close to make sure our punch list is thorough. 

We have built our two previous homes new as well. And you learn a lot. This is our true dream home we are building and most likely our forever home (I am turning 50 next month....Jesus Christ man). You get a one year bumper to bumper (10 year structural) so we want to make sure we have as few issues to remedy as possible before closing.

We are very excited. We also drive by weekly to check on construction, take photos of every phase, and also clean up garbage all around and inside our lot. We learned this from our last home and never want to have chicken bones inside our dry wall LOL!!!

The homes that have been built in this new community have been high quality and we are not too nervous as WCI-Lennar has a very solid reputation. 

 

 

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9 hours ago, brun said:

Have a little less than 1.5 years left on a 5-1, 2.85 ARM from a CU. Estimated equity is 150k on a primary residence with my estimated market around 370k (Zillow says 399k). Not included is a 43k HELOC (opened 2019, different CU) from which I've taken out 20k for some updates.

So, considering a refi in the near future, before my rate goes up.

@Chadstroma got any contacts in New Hampshire you'd like to recommend?

Thanks for being so generous with your time in this thread!

 

New Hampshire... testing me huh? 🤣

I don't think I know anyone in NH but I am sure I can find someone licensed there. Give me a bit to reach out and see what I can find for ya. If you don't hear from me in a couple of days just poke me.

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10 hours ago, Chadstroma said:

It all depends. There are WAY too many factors involved in deciding if it makes sense to refi or not. The longer you plan on staying in the property, the more the rate drops, the smaller the amount of costs and the further it gets you to your goal (more cash flow or more savings) then the stronger the argument is to refi. There are no hard yes and no based on pure rates. I have seen too many people over my 20 years of dealing with people and their finances that they get some ridiculous idea in their head about how much you have to lower rate to make it make sense. SO many people have pieces of info or half truths or misunderstand a concept and take it as gospel and then make bad financial decisions. Talk to a pro that isn't a scum bag and make an informed decision. 

Is there a rule of thumb on the bold?

I'd have thought it would take more than 0.25% to make refi worth while, with no points. I suppose no cost, APR decreases at all could make it worthwhile. 

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23 hours ago, Chadstroma said:

Rates are crazy silly right now. I am locking in some great rates and a lot of them aren't paying any costs (not rolled into the loan but providing lender credits to cover them). If you been on the fence, time to get off and talk to someone. If you haven't thought about it.. time to not think hit act. Good luck all!

How low are you seeing 15 and 20 year loans?

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On 1/15/2008 at 11:57 AM, John Mamula said:
MechEng said:

I can currently refinance for 5.5% from my current 6.5%. Will they continue to drop, go up or stay steady? It just dropped .125% from yesterdays rate.

if you can get 5.5% i would take it, especially in light of the current credit constraints that persist throughout real estate right now.that is historically a phenomenal rate. i personally wouldn't gamble to try and extract another 10 bips out of it.

I remember getting 5% on our first home in '09 and thinking how great it was. 2.7 a couple years later on refi.  Now almost that low on our 2nd home. Good times. Free money is still flowing. 

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16 hours ago, -OZ- said:

Is there a rule of thumb on the bold?

I'd have thought it would take more than 0.25% to make refi worth while, with no points. I suppose no cost, APR decreases at all could make it worthwhile. 

It all depends... 

If you are truly paying no closing costs (not rolling into loan but credits cover costs) then .125% makes sense. It is free and costs nothing. 

Any cost above that, you want to calculate the break even point. That is the amount of time the savings from the redi offset the costs of doing the refi. If you plan on being in the property after that point then it makes sense. 

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15 hours ago, rascal said:

How low are you seeing 15 and 20 year loans?

There are so many variables on this. I hate giving rates because one great rate for one person is the sucks for another and then one person who can't get close to what it is get frustrated. 

Loan size, location, type of property, loan to value, credit score, type of loan, loan term, type of transaction, origination points/credits and comp structure all greatly impact the rate. 

That being said I am seeing the 2's being broken into. 

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15 hours ago, flapgreen said:

I remember getting 5% on our first home in '09 and thinking how great it was. 2.7 a couple years later on refi.  Now almost that low on our 2nd home. Good times. Free money is still flowing. 

My first condo was 6.375% and I was excited. 

Now, I have non-QM clients that balk at such a high rate. 🤣

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15 hours ago, flapgreen said:

Big thanks to Chad. Been in this thread helping FBGs since '08.  Awesome bro

Thanks, my pleasure. I like to help. 

I hate seeing people get screwed. It was why I would not be a broker before (if you go back long enough in some threads, you will find posts of me blasting brokers) and now why I love being a broker. 

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12 minutes ago, Chadstroma said:

There are so many variables on this. I hate giving rates because one great rate for one person is the sucks for another and then one person who can't get close to what it is get frustrated. 

Loan size, location, type of property, loan to value, credit score, type of loan, loan term, type of transaction, origination points/credits and comp structure all greatly impact the rate. 

That being said I am seeing the 2's being broken into. 

Geez I just refi’d down to about 3.5 this past summer. Wonder if I should call my guy :unsure: 

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1 hour ago, Chadstroma said:

Thanks, my pleasure. I like to help. 

I hate seeing people get screwed. It was why I would not be a broker before (if you go back long enough in some threads, you will find posts of me blasting brokers) and now why I love being a broker. 

Got anybody in cleveland (east of cleveland preferably) for a potential cash out refi?  Not huge numbers or anything.  House worth about 150k, owe 60k, would like to pull out 60k.  

Any idea what the best rates are out there for that?  15 year or even 30 year

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6 hours ago, ghostguy123 said:

Got anybody in cleveland (east of cleveland preferably) for a potential cash out refi?  Not huge numbers or anything.  House worth about 150k, owe 60k, would like to pull out 60k.  

Any idea what the best rates are out there for that?  15 year or even 30 year

I reached out to the guy I did my last rental property loan with a couple years back.

He just told me if I did a cash out refi of 60k, making my new loan amount 120k, the rate for a 15 year would be 3.875 and for a 30 year would be 4.375.

Closing costs are unclear but probably around 3 grand.  

Do those numbers sound reasonable or would I be getting screwed?

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12 minutes ago, ghostguy123 said:

I reached out to the guy I did my last rental property loan with a couple years back.

He just told me if I did a cash out refi of 60k, making my new loan amount 120k, the rate for a 15 year would be 3.875 and for a 30 year would be 4.375.

Closing costs are unclear but probably around 3 grand.  

Do those numbers sound reasonable or would I be getting screwed?

The 4.375 isnt so bad, the 3.875 seems high.

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8 hours ago, Capella said:

Geez I just refi’d down to about 3.5 this past summer. Wonder if I should call my guy :unsure: 

It takes alot to break that 2... don't get too excited but it doesn't hurt to talk. If he is a broker,  as long as there have been 6 payments made on the mortgage he/she would be happy to talk the options through.

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7 hours ago, ghostguy123 said:

Got anybody in cleveland (east of cleveland preferably) for a potential cash out refi?  Not huge numbers or anything.  House worth about 150k, owe 60k, would like to pull out 60k.  

Any idea what the best rates are out there for that?  15 year or even 30 year

Not sure about about Cleveland but Ohio for sure. I will connect you and you guys can talk specifics on rates. PM your contact info and I will send it over to him.

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46 minutes ago, ghostguy123 said:

I reached out to the guy I did my last rental property loan with a couple years back.

He just told me if I did a cash out refi of 60k, making my new loan amount 120k, the rate for a 15 year would be 3.875 and for a 30 year would be 4.375.

Closing costs are unclear but probably around 3 grand.  

Do those numbers sound reasonable or would I be getting screwed?

Compare with the broker I can connect you with. Best way to answer the question. 

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Thanks Chad! 

Now in the process of refi at 2.75% for 30. This will be my first refi ever. When you do this, do you just start over at 30, thus lowering the actual payment? 

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50 minutes ago, -OZ- said:

. When you do this, do you just start over at 30, thus lowering the actual payment? 

Yes you start over at 30 or whatever number of years you agreed to.

However, if you were to pay the same amount that you were before, more would go towards principal and less towards interest than your current payments, hence, you would pay off the loan much faster without even paying more out of pocket.

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54 minutes ago, -OZ- said:

Thanks Chad! 

Now in the process of refi at 2.75% for 30. This will be my first refi ever. When you do this, do you just start over at 30, thus lowering the actual payment? 

Good job. 

Yes, if you get a 30 year term it is starting over paying over 30 years, so unless you were getting cash out then you would lower your payment amount for sure. 

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