tomkaz

Have you checked out re-financing your mortgage loan lately? Rates are down, waaaay down.

Rate this topic

18 posts in this topic

If you do not have a mortgage on a home, you can skip reading the balance of this. For that that do, hopefully this is a public service message that some can utilize. 

 

If you have a mortgage that was put in place or even refinanced in the last 18 months or longer, you might want to consider the math on refinancing. With the collapse in interest rates since last October, even mortgages priced in early 2018 might be worth reviewing. 

 

We closed on our new house in February 2018 with a 30Y fixed rate of 4.10% (non-conforming, 80/20%) 

 

In June, I checked and the re-fi rate was 3.7%. Given Florida closing costs and other fees, that monthly savings would have meant a pay-back period of about 13-14 months. Not great, but not bad either. 

 

Last week, that re-fi rate dropped further to 3.3% which dropped the payback rate a few more months. 

 

And then my lender, who happens to be my employer, surprised me with an offer of a “loan adjustment” to this lower rate without going through a complete re-fi. For a fee that is less than a quarter of the total cost of a full re-fi, I get to lower my rate, keep the mortgage term intact (i.e. 28.5 years) and not have to get an appraisal, credit check or full doc package. 

 

Now, this only works because the lender retained the loan and did not securitize it. Thus, it is cheaper for them to do this adjustment than go through their costs of a re-fi. 

 

So the loan adjustment I lucked into will not be available for everyone, but it is worth asking if a similar program is available with your lender.

 

And if it is not, then a re-fi might still be something worth investigating. 

Share this post


Link to post
Share on other sites
2 mins ago, tomkaz said:

If you do not have a mortgage on a home, you can skip reading the balance of this. For that that do, hopefully this is a public service message that some can utilize. 

 

If you have a mortgage that was put in place or even refinanced in the last 18 months or longer, you might want to consider the math on refinancing. With the collapse in interest rates since last October, even mortgages priced in early 2018 might be worth reviewing. 

 

We closed on our new house in February 2018 with a 30Y fixed rate of 4.10% (non-conforming, 80/20%) 

 

In June, I checked and the re-fi rate was 3.7%. Given Florida closing costs and other fees, that monthly savings would have meant a pay-back period of about 13-14 months. Not great, but not bad either. 

 

Last week, that re-fi rate dropped further to 3.3% which dropped the payback rate a few more months. 

 

And then my lender, who happens to be my employer, surprised me with an offer of a “loan adjustment” to this lower rate without going through a complete re-fi. For a fee that is less than a quarter of the total cost of a full re-fi, I get to lower my rate, keep the mortgage term intact (i.e. 28.5 years) and not have to get an appraisal, credit check or full doc package. 

 

Now, this only works because the lender retained the loan and did not securitize it. Thus, it is cheaper for them to do this adjustment than go through their costs of a re-fi. 

 

So the loan adjustment I lucked into will not be available for everyone, but it is worth asking if a similar program is available with your lender.

 

And if it is not, then a re-fi might still be something worth investigating. 

you're an idiot Mr. Kaz. 

Share this post


Link to post
Share on other sites
Just now, Reed422 said:

it's pronounced spa-zzzzzzz

He just rambles on and on. His posts are like Ethiopian sign language. 

Share this post


Link to post
Share on other sites

Posted (edited) · Report post

I took advantage of everything my lender offered and got down too 3.85 30 yr fixed .. this was two months ago or so when we closed .. I think it’s fair but betters , better 

Edited by Wire For Fire

Share this post


Link to post
Share on other sites

The other thing to consider when refinancing is that you are getting into another full 30 year term. So, the rate modification (for a fee) option is the best way to go. It just reduces the rate for the balance of the term without re-amortizing it. Unfortunately, not all lenders offer that feature. Some have it but do not advertise it.

Share this post


Link to post
Share on other sites
33 mins ago, MitchellNJ said:

I'm riding out my 15yrs at 2.5%. We will not see those kinds of numbers in a long time. I can't wait to pay this thing off.

 

Me too. :beers:

Share this post


Link to post
Share on other sites

Just as a point of fact, after 20 years as owners, we were renters from the summer of 2014 through Feb 2018, missing the opportunity to lock in some of those great rates you guys are suggesting. 

Share this post


Link to post
Share on other sites

I paid off my 15 yr loan three years ago. However, for you guys who have rates in the 3% range, you may want to think about investing some of the money rather than pay down a 3% loan. You can likely find some investment vehicle that will pay you more than 3%

Share this post


Link to post
Share on other sites
12 mins ago, EricJ said:

I paid off my 15 yr loan three years ago. However, for you guys who have rates in the 3% range, you may want to think about investing some of the money rather than pay down a 3% loan. You can likely find some investment vehicle that will pay you more than 3%

You summoning sim?

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to register here in order to participate.

Create an account

Sign up for a new account in our community. It's easy!


Register a new account

Sign in

Already have an account? Sign in here.


Sign In Now

  • Recently Browsing   0 members

    No registered users viewing this page.