OT: anybody refinancing?
I looked into in in MA a few days ago as I want to get out of my 7/1 ARM. However, I did not find any rate comparable to what I already have. Best I saw was 3.5% for a fixed 20 year.
I’m in similar situation. Debating rolling into a new 7/1 ARM. I can get about 8k per year back. But I still have the adjustment 7 years down the road. Debating this route vs just locking in a good 30 year rate now. Wish I did it a week ago when rates cratered.
I'm not a personal finance expert, but if you're looking at 7 years of saving $8k/year, you have to ask yourself if it's worth "paying" $56k to lock in a fixed rate for beyond 7 years assuming that you will be in the home that long AND that you won't have a reasonable refinance option by then. I personally would take the guaranteed savings and take a little rate risk because who knows what life events will be thrown at me that may have me out of the home in 7 years or less (job transfer, parents' health, kids' schools, upgrading to a newer/bigger home, downgrading to a smaller one, etc.)
i tried to get a quote from my current lender but suntrust (my lender) told me they had hit the limit on how many refinances they could do and i should try again in a couple weeks lol
I ran into a similar problem a few years back, got put on a 6 month waitlist to refi. I found a new lender.
good to know! i really should do that anyways because im sure i can get a better rate elsewhere, but i hate filling out a website like lendingtree and then getting a million calls and emails afterward.
We had that problem with Quicken Loans. We were bombarded quickly after that inquiry.
Exactly-- good luck getting called back after they get your contact info. The one tip I've heard is try smaller lenders, the bigger guys are overwhelmed and counterintuitively the smaller folks are more able to pick up the slack. Rates might be better, too (see my "throttling" comment below).
I'll wait. They'll go lower.
Not a guarantee. Maybe .25% or so, not much more room to go and depends on where bonds go. I was quoted a 3.125 30 yr fixed. That is 2012 levels. Contrary to popular belief rates don't always go down when the market does. Generally when the market tanks bonds go up but bonds haven't been behaving as expected. Hell, even gold got hammered and all the crypto like BTC got hammered as well. You could in theory save a little bit more if you wait, but lenders are swamped now and who knows if your loan can even close if no appraiser can enter your home. Then if it keeps getting worse, will they allow closings? Only eclosing? If it makes sense just do it, don't worry about timing the market, especially when the upside is low and the downside is high.
Have you seen his house?
Just a place to hang your hat, really.
A nice little secluded space for the family to unwind at over the weekend.
I think they'll do another cut, they're saying another 50 points is not out of the question later this year. I think for me it'll be beneficial to wait, especially with all the uncertainty right now.
I don't dispute that the FED will cut rates, but again, that doesn't translate 1:1 with consumer retail mortgage rates. I've seen retail rates go up after a FED cut. I am personally convinced that we will be at 0% fed rate sooner rather than later. I still don't think there is much room for retail rates to drop in this environment.
I did a cashout 3.125% /0.875 points refi at a credit union. I applied last Thurs night. The credit union was then quoting 3.125%/0.875% points, but in the morning I held off when the loan officer asked me if I wanted to lock as the 10 year US Treasury had fallen from 0.92% the night before to 0.75%. I ended up locking Tuesday morning at the same rate after seeing no change in the credit union's rate in spite of the 10 year falling as low as ~0.30% intraday and closing around 0.50%.
At the same credit union, I see the quote has now changed to 3.25%/0.25% points.
Ouch.
I just got 2.875 with 0 points.
Can you still bail?
Where was that?
Caliber.
I love em... they service 90% of their loans too so your chances of getting sold and going to a shitter lender are low.
Understood, and I agree. All that money the Fed is injecting into the system has to go somewhere, I can only hope it will work to our advantage for a change. If not, I'll wait for things to settle down and give it a go in a couple months.
3.625 for 30 year jumbo.
#SubtleBrag
I always put enough down to avoid having to get a jumbo loan.
Humble brag is when your house is paid off and that's why you don't need to refinance. This guy just owes a ton of money
Yes. I'm indentured to the markets.
last week the jumbo's were down to 3.33%. Everyone jumped on the refinance bandwagon and they jumped back up to 3.625
3.375% on a 30yr. Rates are moving up as companies can't service the amount of finance requests.
Exactly, it's an industry practice called "throttling" which is essentially just raising rates to discourage being overwhelmed by shoppers like it's a Walmart on Black Friday.
If the normal spread on 30-year fixed mortgage vs. 10-year Treasury existed right now, rates would be 2.75%. The difference between that and the average today (about 3.36%) is artificially being introduced by the lenders.
We did. Saved quite a bit on monthly payments. And if the rates go down again we'll do it again. Our broker has a very cheap closing cost.
what company is your broker
March 13th, 2020 at 12:18 PM ^
It is a small company only in a few states. VA and FL, not sure how many others. They sold the mortgage to Quicken.
don't forget to factor in closing costs.... many people don't consider the up front costs actually add to the total amount the bank gets in the end
My costs were pretty low to refinance since we just purchased 6 months ago. No appraisal and the escrow account doesn't have to be refunded so it was about $1600 out the door to shave over a full percent off our current rate. Even if we were only going to stay a year I'd probably break even, but we intend to be here for a while. Basically I can make my exact same payment and shave 6 years off my loan.
We refinanced about a year or so ago, got locked in at 3.5%, and after the appraisal were able to get rid of our PMI in the process. It was such a blessing for our household. Freed up some more money to help pay our ridiculous childcare and healthcare bills.
Same thing as I did. Refinanced about 8 months ago just under 3.5% --- got rid of my PMI costs, & shaved $120 off my monthly payment. Pretty sweet.
I don't remember paying anything out of pocket at all. Mortgage company paid all the closing fees.
Currently have a 15 yr fixed at 3.25, so its gonna be hard to beat that, but definitely looking into it. Still have nine years left on the loan.
If you have only 9 years left than almost no rate will make it worth your while if you are paying a few k in closing costs.
https://www.myamortizationchart.com/
If you were in the 9th yr of a 200k loan, you would only have roughly 12kish interest left. Add a few k to the balance and it off sets the drop quite a bit. In theory if you never refinanced again there is a point where it makes sense, but most people refi every few years for one reason or the other, so it usually doesn't make sense for most people to drop a small amount in interest considering the won't be in the loan long enough to realize the gain. It depends on your situation of course, but people always forget that interest rates are a function of time. If you don't give it the time to benefit you, it doesn't make sense. It isn't like a lower rate miraculously saves you money. I did loans for a long time, I remember talking to so many people who bragged about 2% loans where I then had to tell them their 2% was on a 40yr and the total interest they were paying was far high than a much higher rate at a shorter term. If they needed the monthly savings, whatever, but many people just assumed lower rate was always better and it was sort of eye opening for me to realize how little otherwise intelligent people knew about finances.
Thanks man. That's pretty much what our financial adviser told us about a year ago when rates dipped. But they are running numbers for us again. No humble brag, but its a bit more than 200k.
No problem! Stay the course if paying the home off is your main goal, but always be willing to make a smart move. Sounds like you're doing the smart thing by exploring. At the end of the day, do what you're comfortable with. You might be able to save a few thousand in interest or over 9 years, but then you also need to think about the value of your time and the chance you may refi in a few years to buy a vacation home or something. Who knows. When you're sitting on 200k+ of equity in a few years getting that cash tax free can be appealing if you're looking at a big purchase.
Right now I'm at a 3.6ish rate with 11 years left on a 20 yr loan (I refi'd in 2012) and paying a few hundred extra in principal each month to hopefully pay off the house in about 7 more years. So theoretically I'm not a candidate for refi'ing?
Depends on the deal and your goals. It certainly isn't a slam dunk like it is for some. For example, assuming you started at a 200k loan amount on a 3.625.If you can get lets say a 10 yr at 2.99 you would have a balance of roughly 128k at the end of year 9. You would be scheduled to pay around 28k in interest (assuming you never paid extra. That messes up the numbers).Even if you refied into a 10yr at 2.99 where your loan balance was now 133k with costs and escrow you only be paying a little more than 21k over the ten years. However in this scenario your payment would be actually a little higher than it currently is. With a better rate or less cost it certainly makes sense from a total money spent over time situation, but is a high payment ok? Will you sell your home in 4 years? These are the types of variables people need to consider when determining if a refi makes sense. Is there a mathematical place in today's market you can improve on your current loan? Most likely. Is it a slam dunk? Probably not. Talk to a financial planner about you goals.
Shop around for local/regional banks that don't gouge you on the closing costs. I refinanced around 5 years ago to a 15 year fixed, 2.875 apr, and $300 to close with Union Savings bank out of Cincinnati. That included an additional $50 fee to record the mortgage because I'm in the next county over from their closest branch office. I had to do a lot of follow up on my end from the broker, but for that money I'll take a bit worse service.
I got in last week before rate crept back up. 3.15 on 30 year, briefly considered a 15 year at 2.68 but passed.
Wow, that would be nice. I'm currently at 4.375 on a 30 year, hopefully I didnt miss the boat.
I’m at 4.625 now....basically right on the line of it being worth it since we bought 2 yrs ago. Would be interesting to see the savings, and do I want to reset the 30 year clock again. Being 36, is not sure.
If your rate is that high and your credit is fine it will almost for sure make sense. You don't have to reset your loan. You could do a 25 yr loan and your rate would most likely drop enough to make the payment the same. Or you can go back to a 30yr loan and just pay what you pay now and accelerate your term and save tons. All this depends on your equity, credit, PMI, etc but the odds are low it wouldn't make sense TBH. Call a good mortgage company and they can show you.
https://www.myamortizationchart.com/
If you had a 200k loan and were only 2 yrs into it your balance would be 190ish by now. Even adding 5k to your loan and doing a 25yr at 3.5 you would save roughly 30k in interest. Your payment would also be lower, so if you paid the same amount each month, your overall savings would be higher
Not a Refi, but currently house shopping so I've been watching rates daily at a few potential lenders. It's crazy how volatile they've been - over 3 lenders I've seen everything from from 2.75% to 3.875% (no points) on a 30 year just within the past 2 weeks. As of this moment, they've crept back up and that 2.75% lender is now at 3.375%.
Paid it off a few years ago but I definitely would if I still had one.
You might want to consider a equity loan to put into the market when it finishes tanking. Depending on how old you are
This is what I'm tempted to do. Got a fair bit of equity in the house and it's tempting to just start over on a 15 year mortgage and plow like $250k into the market.