Jump to content
Fantasy Football - Footballguys Forums

Personal Finance Advice and Education!


No. 16

Recommended Posts

55 minutes ago, Tiger Fan said:

Do you have this?  Curious to what you pay.  My employer used to provide it, but cancelled; which means it's probably getting more expensive by the day.  

no (well, sort of - my employer insures me), but we haven't turned 40 yet.  From what I've been told (which could be wrong), we should look into it when we approach 60. 

Link to comment
Share on other sites

23 minutes ago, Binky The Doormat said:

Thankfully she has your parents.  What would happen if they weren't there for her?  

Would she go to a publically funded facility?  (That I would think would be not so great)

Not at all. I did some volunteer work at a place like this. Huge building with run down smelly small apartments. Counting literally every penny to make it to the next social security paycheck. Heart breaking.

Link to comment
Share on other sites

45 minutes ago, Chadstroma said:

Not at all. I did some volunteer work at a place like this. Huge building with run down smelly small apartments. Counting literally every penny to make it to the next social security paycheck. Heart breaking.

More people should volunteer at something like this.   This is going to be the reality for a lot of people... a LOT

Link to comment
Share on other sites

1 hour ago, ZenMaster said:

This is my response from way back in this thread regarding LTC:

It provides 36 months of coverage, $3000/month with simple inflation protection. We qualify if/when we lose two ADLs (Activities of Daily Living - dressing, eating, going to the bathroom, etc.). The money is paid regardless of how much the care costs. This includes things like home health so it wouldn't necessarily have to be in a nursing home or assisted living facility.

She said we signed up back in 2003/2004 when I was in my late 20s and she was in her early 30s. She said the insurance companies typically have policies that provide 2-4 years of coverage. Our coverage is $27/month.

I sell LTC.  Just a few notes about the bolded parts of your statement, and some other general thoughts.

The second bolded part is called an "Indemnified" policy.  They used to be very common, but are quite rare now.  Typical policies now are "reimbursements" where you're paid back for whatever expenses you have (so if you have $3000 a month, but your expenses are only 1,500 you only get paid 1,500 from the policy - but the other 1,500 is put on the "back end" of your 36 months of coverage).

The first and third bolded parts - many companies won't write a policy for anyone under age 40.  Interesting that you were interested in one at your very young age.  Why did you opt for only simple inflation and not compound inflation at those very young ages?  Example - just say you were 30 when you got it, the $3k at simple inflation will be only $11,250 a month - but if you had compound inflation it would be roughly 4x as much, 43,907 a month. 

The coverage is ridiculously cheap - but remember that rate isn't guaranteed.  It could jump at any time.  This isn't like life insurance which has it's rates set from the start.  It's more like health insurance in the rates can (and do) go up.

 

Link to comment
Share on other sites

1 hour ago, Tiger Fan said:

what happens if you outlive the 36 months?

You pay yourself.  Now his policy is apparently different than most in that it's an "indemnity" policy (explained in my prior post). 

If it's like most policies, though, he'll have a "pool" of money to start using at the beginning of that 36 months.  Keep it simple and take his inflation out of it.  He's got $3k a month for 36 months - or a "pool" of $108k.  Say his LTC expenses are only $2k a month, though.  It would last 54 months, or 4.5 years.

Link to comment
Share on other sites

So as many of you know, I'm a life insurance agent.  Came across a very, very old policy today where we will likely have a death claim "in the next few months".  The details of the policy were interesting.

It was taken out in 1932 (they were 11 at the time, I think 95 now)!  For perspective, that was 7 years before WW2.  It was a whole life (without underwriting or health classes) for $1k.  It had an annual premium of $15.19.  So total premiums to this point are 1,276 (15.19 x 84 years).  Cash value today is 12,315, with a death benefit of just over that.  No, the return on premium wasn't much (4.4% best I can tell), but this was back in the time of just sign up and well give you a policy. 

We're looking to see if it's the oldest policy on the books with the carrier.  Crazy stuff.

Link to comment
Share on other sites

2 hours ago, Dentist said:

I thought long term care insurance had kind of jumped the shark in terms of being a good bang for buck.   I think it used to be a good deal.. not so much now.

That's what I heard as well. A lot of "pros" recommend self insuring the costs.

Link to comment
Share on other sites

2 hours ago, Dentist said:

I thought long term care insurance had kind of jumped the shark in terms of being a good bang for buck.   I think it used to be a good deal.. not so much now.

back in the day it was really good bang for the buck as long as you purchased with a company that didn't up their rates later on.  I've seen carriers up the rates on their current block of business by 30-40% - and what's a person in their 70s or 80s going to do with that?!  Also, up till about 5 or so years ago you could buy a policy with a lifetime benefit, with indemnity, and even with a rider to allow a family to be your caregiver and for them to get paid from the contract.  Lots of those options have gone away, and an identical policy purchased today would be 30-50% more (if not higher) than the same policy purchased 10 years ago.  Carriers lost some serious money on some of those policies ($300 a day at compound inflation for a 70 year old who will be in a nursing home for the next 20 years adds up!). 

A "new" LTC option is to include LTC in your life insurance.  It's a very inexpensive rider that you can attach to a whole life policy which allows you to "spend" your death benefit while you're still alive for LTC purposes.  It's only been around for a few years - but in the carrier's eye, they are going to pay out the claim eventually, why not charge just a little bit more (seriously, like 2-4% additional charge) to allow you to use it for LTC if you need it. 

Edited by matttyl
Link to comment
Share on other sites

2 hours ago, matttyl said:

I sell LTC.  Just a few notes about the bolded parts of your statement, and some other general thoughts.

The second bolded part is called an "Indemnified" policy.  They used to be very common, but are quite rare now.  Typical policies now are "reimbursements" where you're paid back for whatever expenses you have (so if you have $3000 a month, but your expenses are only 1,500 you only get paid 1,500 from the policy - but the other 1,500 is put on the "back end" of your 36 months of coverage).

The first and third bolded parts - many companies won't write a policy for anyone under age 40.  Interesting that you were interested in one at your very young age.  Why did you opt for only simple inflation and not compound inflation at those very young ages?  Example - just say you were 30 when you got it, the $3k at simple inflation will be only $11,250 a month - but if you had compound inflation it would be roughly 4x as much, 43,907 a month. 

The coverage is ridiculously cheap - but remember that rate isn't guaranteed.  It could jump at any time.  This isn't like life insurance which has it's rates set from the start.  It's more like health insurance in the rates can (and do) go up.

 

My wife is the insurance expert in the family so I asked her. She was probably wondering why I was texting her today asking insurance questions. :D.

She works at an insurance broker and she suggested LTC several years ago. I think it was because of her experience in the industry and knowing how inexpensive it would be at our age. She said there was a compound inflation policy but it was significantly more expensive than the simple inflation policy. She couldn't remember the exact rate, only that it was 'super pricey'. 

  • Like 1
Link to comment
Share on other sites

This might sound shticky, but it's not entirely intended to be. VR is going to be awesome in 10 or so years. I certainly am after financial independence to be able to walk away from full time work asap and I'm a huge proponent of experiences, but I think VR might be a massive change for lots of folks' retirement. Don't have quite enough to see the Roman ruins? Here's a reasonable facsimile plus porn so good you'll never want to leave your house. 

Link to comment
Share on other sites

4 hours ago, Rirruto said:

This might sound shticky, but it's not entirely intended to be. VR is going to be awesome in 10 or so years. I certainly am after financial independence to be able to walk away from full time work asap and I'm a huge proponent of experiences, but I think VR might be a massive change for lots of folks' retirement. Don't have quite enough to see the Roman ruins? Here's a reasonable facsimile plus porn so good you'll never want to leave your house. 

 

Never thought about it that way.  

I do like human interaction though.

Link to comment
Share on other sites

8 hours ago, matttyl said:

So as many of you know, I'm a life insurance agent.  Came across a very, very old policy today where we will likely have a death claim "in the next few months".  The details of the policy were interesting.

It was taken out in 1932 (they were 11 at the time, I think 95 now)!  For perspective, that was 7 years before WW2.  It was a whole life (without underwriting or health classes) for $1k.  It had an annual premium of $15.19.  So total premiums to this point are 1,276 (15.19 x 84 years).  Cash value today is 12,315, with a death benefit of just over that.  No, the return on premium wasn't much (4.4% best I can tell), but this was back in the time of just sign up and well give you a policy. 

We're looking to see if it's the oldest policy on the books with the carrier.  Crazy stuff.

God forbid she had invested it, @ 9% it would have only been $314,000.

Link to comment
Share on other sites

8 hours ago, Vincesanity said:

God forbid she had invested it, @ 9% it would have only been $314,000.

Isn't it crazy the difference between 4.4 and 9% over that length of time.  I got 271K in the calculator I threw it in, but still that and 12K is just crazy.

  • Like 1
Link to comment
Share on other sites

 

9 hours ago, Vincesanity said:
17 hours ago, matttyl said:

So as many of you know, I'm a life insurance agent.  Came across a very, very old policy today where we will likely have a death claim "in the next few months".  The details of the policy were interesting.

It was taken out in 1932 (they were 11 at the time, I think 95 now)!  For perspective, that was 7 years before WW2.  It was a whole life (without underwriting or health classes) for $1k.  It had an annual premium of $15.19.  So total premiums to this point are 1,276 (15.19 x 84 years).  Cash value today is 12,315, with a death benefit of just over that.  No, the return on premium wasn't much (4.4% best I can tell), but this was back in the time of just sign up and well give you a policy. 

We're looking to see if it's the oldest policy on the books with the carrier.  Crazy stuff.

God forbid she had invested it, @ 9% it would have only been $314,000.

If she had only invested the $15 once, in 1932 she would have $69,135 

so only over 5x what she got in the whole life policy, and she didn't have to put anything else in over 80 years.

Link to comment
Share on other sites

9 hours ago, Vincesanity said:

All this whole life talk makes me sick.

Why in the world would someone under 40, much less 50, buy LTC.

Because a few years ago it was a pretty good deal (assuming the carrier doesn't increase the rates later on their in force LTC block of business, which many have). 

Link to comment
Share on other sites

9 hours ago, Vincesanity said:

God forbid she had invested it, @ 9% it would have only been $314,000.

Um, it would have been only 234,870, but who's counting ($15.19 annually at 9% for 84 years). 

She'd also been pulling out the dividends for something like the last 40 or so years in cash, so there's that.  I don't have those numbers (yet), but it did produce an income stream for her during her retirement years, albeit not a huge one.

And the policy is 84 years old, they are vastly different now.  It was a guaranteed issue policy on an 11 year old when it was purchased.  I was just amazed it had been on the books for so long.

Edited by matttyl
Link to comment
Share on other sites

3 hours ago, matttyl said:

Um, it would have been only 234,870, but who's counting ($15.19 annually at 9% for 84 years). 

She'd also been pulling out the dividends for something like the last 40 or so years in cash, so there's that.  I don't have those numbers (yet), but it did produce an income stream for her during her retirement years, albeit not a huge one.

And the policy is 84 years old, they are vastly different now.  It was a guaranteed issue policy on an 11 year old when it was purchased.  I was just amazed it had been on the books for so long.

I get a different number assuming it was a single annual payment. Regardless it's more the principal of it than expecting someone to have done it starting in 1934. It is a cool story though.

Taking dividends out to live on, come on now. She's buying a hamburger once a year with the dividends.

 

Link to comment
Share on other sites

3 hours ago, matttyl said:

Because a few years ago it was a pretty good deal (assuming the carrier doesn't increase the rates later on their in force LTC block of business, which many have). 

It's a pretty good deal because your odds of using it from 40-50 are about 1%. Someone over 60 qualifying after a standard 90 day waiting period is about 35%.

 

Accidental death and cancer policy's are "pretty good deals" too because they're crap.

 

Someone age 40 can get a living benefits rider added onto their term policy for probably $10 more a month. A much better deal than LTC at that age.

Link to comment
Share on other sites

11 minutes ago, Vincesanity said:

I get a different number assuming it was a single annual payment. Regardless it's more the principal of it than expecting someone to have done it starting in 1934. It is a cool story though.

Taking dividends out to live on, come on now. She's buying a hamburger once a year with the dividends.

 

??  The dividend is based on the cash value of over 14k.  The dividend rate has been up and down over the past 40 years - but even a 5% dividend on 14k is $700.  The company's current dividend is just a smidge over 7.  I mean it's less than $1k a year, but it's certainly more than a hamburger.  Remember, this was a $1k policy initially taken out on on a 11 year old without any underwriting.  I was just amazed it's still on the books after all that time.

Also, if that's how you computed your number it would have been even lower.  A single annual payment of 15.19 compounded at 9% over 84 years would be only 21,153.

Edited by matttyl
Link to comment
Share on other sites

Just now, Vincesanity said:

It's a pretty good deal because your odds of using it from 40-50 are about 1%. Someone over 60 qualifying after a standard 90 day waiting period is about 35%.

 

Accidental death and cancer policy's are "pretty good deals" too because they're crap.

 

Someone age 40 can get a living benefits rider added onto their term policy for probably $10 more a month. A much better deal than LTC at that age.

Um, I think you're missing a huge part here....

You buy a LTC policy and plan on keeping it forever.  It's not like a term policy at all.  You buy it at 40 when it's cheaper and keep it till you die.  It's not a buy it at 40 and drop it at 50 kinda thing - that would just be dumb. 

You buy it at 40 or 50 and put inflation protection on your benefit so that at age 80 it's likely tripled or quadrupled in benefit (assuming a 5% compounding rider).  It's not so much a deal at 60 when it's already 2-3x as expensive and you need to buy 2x as much benefit to match what you would have had, if you had purchased in your 40s.

  • Like 1
Link to comment
Share on other sites

  • 5 weeks later...
On ‎7‎/‎15‎/‎2015 at 10:54 AM, Kal El said:

Wife and I are doing Dave Ramsey's Financial Peace University, and we're putting plans in place to get out of all non-mortgage debt within the next 3 years, and finishing our 30-year mortgage off by 2023, after just 13 years. We'll pay cash for stuff to avoid taking out more debt, and eventually get rid of our credit card. Turns out with all of our debt, we're paying about $1,600 a month in debt. If we save that money for 5 months, I can pay cash for an $8,000 vehicle.

Status update?

I just started helping lead another class (I had helped with one over a year ago).  While I don't like that it costs about $100 for the customer, that's a small price to pay if it helps change your life. Would love to hear some good news stories.

Link to comment
Share on other sites

@Kal Elhopefully you refinanced the loan to get the lower rate an increase your principal reduction payments rather than just keep it in a 30 year loan. Though I am not a big fan on of such a focus on paying off the mortgage loan at these ridiculous rates that are available today. It could make sense for some people and if it does- take advantage of the situation and reduce your rate to get the loan paid off quicker. I think the biggest thing in personal finance is that there is no such thing as a one size fits all approach- and that is my biggest complaint about Dave Ramsey.

  • Like 1
Link to comment
Share on other sites

1 hour ago, Chadstroma said:

@Kal Elhopefully you refinanced the loan to get the lower rate an increase your principal reduction payments rather than just keep it in a 30 year loan. Though I am not a big fan on of such a focus on paying off the mortgage loan at these ridiculous rates that are available today. It could make sense for some people and if it does- take advantage of the situation and reduce your rate to get the loan paid off quicker. I think the biggest thing in personal finance is that there is no such thing as a one size fits all approach- and that is my biggest complaint about Dave Ramsey.

To be honest though it's broke people that flock to Ramsey. If these type of people follow his plan by the time they are wasting money paying off the house they have already: eliminated all debt except the house, have 3-6 months emergency fund, are investing 15% into retirement, and have funded college for their kids. I would say that's a resounding success given the clientele. While paying the house off may not be the absolute best way to use their newfound wealth, I can appreciate that he prefers to keep the ball rolling while these formerly broke people are still basking in their success.

  • Like 1
Link to comment
Share on other sites

Financial guys I need some advice please.   I will be retiring next year after 30 years with the federal government.  I will be 63.  My retirement will consist of three things:  1) a Monthly Federal Pension (FSPS) check, 2) a monthly Social Security check,  and 3) a fixed monthly withdrawal from my Thrift Savings Plan (TSP).  So I will have 3 "spigots" of income which will total around $11,000/month (after health and life insurance is deducted).  My question is - is there any financial/tax calculators that can provide a good estimate of what my take home amount will be after taxes?  I am living in Florida.  I will eventually hire a tax accountant/financial advisor, but for now are there any software programs or on-line tools where I can input my #'s and have it provide me this "take home" estimate?  Thanks!

Link to comment
Share on other sites

12 minutes ago, NutterButter said:

Good for you.  That's a nice chunk of change.  You are going to be living the hi life.

Thanks, but i have no clue how much of that will be actual take home.   Any ideas on how to figure this out?  

12 minutes ago, Statcruncher said:

I have nothing add other than you are killing it.

 

And making me feel like I'm WAY behind lol.

Financial guys I need some advice please.   I will be retiring next year after 30 years with the federal government.  I will be 63.  My retirement will consist of three things:  1) a Monthly Federal Pension (FSPS) check, 2) a monthly Social Security check,  and 3) a fixed monthly withdrawal from my Thrift Savings Plan (TSP).  So I will have 3 "spigots" of income which will total around $11,000/month (after health and life insurance is deducted).  My question is - is there any financial/tax calculators that can provide a good estimate of what my take home amount will be after taxes?  I am living in Florida.  I will eventually hire a tax accountant/financial advisor, but for now are there any software programs or on-line tools where I can input my #'s and have it provide me this "take home" estimate?  Thanks!

Link to comment
Share on other sites

1 hour ago, wittyusername said:

Financial guys I need some advice please.   I will be retiring next year after 30 years with the federal government.  I will be 63.  My retirement will consist of three things:  1) a Monthly Federal Pension (FSPS) check, 2) a monthly Social Security check,  and 3) a fixed monthly withdrawal from my Thrift Savings Plan (TSP).  So I will have 3 "spigots" of income which will total around $11,000/month (after health and life insurance is deducted).  My question is - is there any financial/tax calculators that can provide a good estimate of what my take home amount will be after taxes?  I am living in Florida.  I will eventually hire a tax accountant/financial advisor, but for now are there any software programs or on-line tools where I can input my #'s and have it provide me this "take home" estimate?  Thanks!

 

Holy ####.  What is your GS grade?

Link to comment
Share on other sites

20 minutes ago, wittyusername said:

Thanks, but i have no clue how much of that will be actual take home.   Any ideas on how to figure this out?  

Not sure exactly.  Isn't all of it considered income?  You just going to be paying federal right?   Probably roughly looking at 100k.   Does it really matter?   You're retirement is going to be pretty sweet as long as you have your health.

Link to comment
Share on other sites

20 minutes ago, NutterButter said:

Not sure exactly.  Isn't all of it considered income?  You just going to be paying federal right?   Probably roughly looking at 100k.   Does it really matter?   You're retirement is going to be pretty sweet as long as you have your health.

Yes, it will all be taxable (federal). Of course Florida has no state income tax.

Link to comment
Share on other sites

On 5/2/2016 at 4:18 PM, No. 16 said:

What percentage of your current/final income do you guys expect/should you plan for your 401k to replace once you retire?

Less than you think.  To start on this you need to realize that a ton of the taxes you pay now just go away.  You no longer pay 7.7% SS+Medicare taxes, state income taxes, federal income taxes.  That is likely to be 25% right there.  Then you typically save some monies on gas, car upkeep, household jobs you now do instead of hiring out, business lunches.  All in I'd say a retiree starts at 70% or so, assuming that there isn't a lifestyle/travel explosion that happens.

Link to comment
Share on other sites

14 hours ago, Statcruncher said:

To be honest though it's broke people that flock to Ramsey. If these type of people follow his plan by the time they are wasting money paying off the house they have already: eliminated all debt except the house, have 3-6 months emergency fund, are investing 15% into retirement, and have funded college for their kids. I would say that's a resounding success given the clientele. While paying the house off may not be the absolute best way to use their newfound wealth, I can appreciate that he prefers to keep the ball rolling while these formerly broke people are still basking in their success.

Like I said- I am not opposed to his strategy outright but what I don't like is his one size fits all approach. He is very monotone in his approach and does not allow for any other approach that could actually benefit. There is no doubt that many people have benefited from listening to him. I have also been in conversations where people use his approach to their detriment because they won't listen to actual numbers and just have his voice echoing in their ears.

Link to comment
Share on other sites

13 hours ago, wittyusername said:

Financial guys I need some advice please.   I will be retiring next year after 30 years with the federal government.  I will be 63.  My retirement will consist of three things:  1) a Monthly Federal Pension (FSPS) check, 2) a monthly Social Security check,  and 3) a fixed monthly withdrawal from my Thrift Savings Plan (TSP).  So I will have 3 "spigots" of income which will total around $11,000/month (after health and life insurance is deducted).  My question is - is there any financial/tax calculators that can provide a good estimate of what my take home amount will be after taxes?  I am living in Florida.  I will eventually hire a tax accountant/financial advisor, but for now are there any software programs or on-line tools where I can input my #'s and have it provide me this "take home" estimate?  Thanks!

For that much income- hire a good tax advisor and he will walk you through and give you good advice on how to limit your tax exposure. I am sure it would be hard to take a walk down the block without stepping on three tax advisor/financial planners feet who specialize in exactly what you are looking for down in Florida.

  • Like 2
Link to comment
Share on other sites

10 hours ago, wilked said:

Witty, got a spouse? Have you done survivorship planning if you kick the bucket next year?

With that much in retirement income, I am sure there are some decent assets currently (if not, WTH?!) which would make it pretty much a slam dunk to get a living trust among other estate planning done. We had all of ours done (wife and myself) done a few years back. It was free for me but the whole enchilada (will, living will, trust, poa, etc) would have cost a couple of grand. For the benefit of avoiding taxes and making things easier on loved ones- easily worth the cost to have a good estate lawyer work with you and draw up all the docs.

Link to comment
Share on other sites

15 hours ago, Statcruncher said:

To be honest though it's broke people that flock to Ramsey. If these type of people follow his plan by the time they are wasting money paying off the house they have already: eliminated all debt except the house, have 3-6 months emergency fund, are investing 15% into retirement, and have funded college for their kids. I would say that's a resounding success given the clientele. While paying the house off may not be the absolute best way to use their newfound wealth, I can appreciate that he prefers to keep the ball rolling while these formerly broke people are still basking in their success.

Exactly.  Most of these people either don't understand finance, don't care enough to make the best decision, or tend to lack discipline.  Most are fine people, we have a literal rocket scientist in this group among other highly educated people.  But they've made some bad decisions and are trying to get on track.  If I can help them do so, I'm in.  

Fwiw I don't follow his plan completely.  We use credit cards, pay them off every month and generally don't buy stuff we wouldn't with cash.  We also won't pay our house off before going above 15% into our retirement account (I put more than that into our tsp, though we'll be maxed by September).  But the principles work until you develop good financial habits.  

Link to comment
Share on other sites

34 minutes ago, Chadstroma said:

Like I said- I am not opposed to his strategy outright but what I don't like is his one size fits all approach. He is very monotone in his approach and does not allow for any other approach that could actually benefit. There is no doubt that many people have benefited from listening to him. I have also been in conversations where people use his approach to their detriment because they won't listen to actual numbers and just have his voice echoing in their ears.

Sure. But frankly if he gave an inch on his program many people would take a mile.   If you follow his program you won't lose.  You won't maximize, but he's selling safety,  not riches. 

Link to comment
Share on other sites

Just now, FUBAR said:

Sure. But frankly if he gave an inch on his program many people would take a mile.   If you follow his program you won't lose.  You won't maximize, but he's selling safety,  not riches. 

He is selling his riches. ;)

Again, it is helpful to many, many, many people. Most of those people are better off listening to him verbatim than they are doing what they did before. It is simple- that is why it works for so many people.

As someone who genuinely tries to help people in the financial services industry- it can be damn frustrating talking to someone who has bought into Ramsey hook, line and sinker because logic, math and general common sense mean nothing. It is all about what Ramsey says. Which makes me want to :wall:

Link to comment
Share on other sites

10 hours ago, Sand said:

 

On 5/2/2016 at 5:18 PM, No. 16 said:

What percentage of your current/final income do you guys expect/should you plan for your 401k to replace once you retire?

Less than you think.  To start on this you need to realize that a ton of the taxes you pay now just go away.  You no longer pay 7.7% SS+Medicare taxes, state income taxes, federal income taxes.  That is likely to be 25% right there.  Then you typically save some monies on gas, car upkeep, household jobs you now do instead of hiring out, business lunches.  All in I'd say a retiree starts at 70% or so, assuming that there isn't a lifestyle/travel explosion that happens.

401K withdrawals are treated like ordinary income, so you still have to pay federal and state income taxes (perhaps at a lower rate, but they don't just go away).

Link to comment
Share on other sites

Chadstroma, once again thank you for your help with my questions on my refi.  Was able to finally close, with a 3.5% 30 year rate.  Hopefully never to be done again, as (just I said 3 years ago) rates will never be lower.....haha.

Anyway, one question that I had.  Old mortgage and new mortgage were from the very same bank, BB&T.  I had built up an escrow account in the old mortgage of over $5k, which as you know was going to be used for upcoming taxes and insurance costs.  Well, with the new mortgage, at closing, I had to pony up a brand new $3,500 or so out of pocket to set up a new escrow account for those very same thing.  Now eventually I'll get the $5k from the old escrow account back (hopefully sooner rater than later), but why can't they just use the funds already there for the escrow on my new loan?  It's not like it's a new and different bank.  Can't they just transfer that?

  • Like 3
Link to comment
Share on other sites

Just now, matttyl said:

Chadstroma, once again thank you for your help with my questions on my refi.  Was able to finally close, with a 3.5% 30 year rate.  Hopefully never to be done again, as (just I said 3 years ago) rates will never be lower.....haha.

Anyway, one question that I had.  Old mortgage and new mortgage were from the very same bank, BB&T.  I had built up an escrow account in the old mortgage of over $5k, which as you know was going to be used for upcoming taxes and insurance costs.  Well, with the new mortgage, at closing, I had to pony up a brand new $3,500 or so out of pocket to set up a new escrow account for those very same thing.  Now eventually I'll get the $5k from the old escrow account back (hopefully sooner rater than later), but why can't they just use the funds already there for the escrow on my new loan?  It's not like it's a new and different bank.  Can't they just transfer that?

They could. It may be a procedure or system thing for them. Perhaps the loan officer didn't do what he needed to do before closing to transfer it. I couldn't tell ya. This would be a lender specific thing.

For my current employer and most of my past- it would not be a problem when doing the same kind of loan. In some cases, I would not be able to (too complicated to go into the exacts of when I could and could not).

Link to comment
Share on other sites

2 hours ago, Chadstroma said:

They could. It may be a procedure or system thing for them. Perhaps the loan officer didn't do what he needed to do before closing to transfer it. I couldn't tell ya. This would be a lender specific thing.

For my current employer and most of my past- it would not be a problem when doing the same kind of loan. In some cases, I would not be able to (too complicated to go into the exacts of when I could and could not).

It just ticked me off that for a period of time I'm actually out a total of $8,500.  I know I'm getting the ~5k back, but it just rubbed me the wrong way.  I'm like "but you already have all my money that you no longer need sitting there."

Link to comment
Share on other sites

17 minutes ago, matttyl said:

It just ticked me off that for a period of time I'm actually out a total of $8,500.  I know I'm getting the ~5k back, but it just rubbed me the wrong way.  I'm like "but you already have all my money that you no longer need sitting there."

Yea, from what I know of your situation I believe we could do the transfer where I work in the same situation.... but there are situations where we can't and I have had to explain that to my customers- which is not fun.

Link to comment
Share on other sites

45 minutes ago, Chadstroma said:

Yea, from what I know of your situation I believe we could do the transfer where I work in the same situation.... but there are situations where we can't and I have had to explain that to my customers- which is not fun.

It is what it is.  They'll mail me a check for the $5k, and another for the extra mortgage payment I made on the old loan the day after the calculated the payoff amount (and didn't let me know). 

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Restore formatting

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

  • Recently Browsing   0 members

    No registered users viewing this page.

×
  • Create New...