Finally got my 3% ARM mortgage

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unclescrooge
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Finally got my 3% ARM mortgage

Post by unclescrooge » Sun Dec 01, 2019 7:36 am

Since there had been a surge in members asking about mortgages recently, I would I would share my experience.

Last week I was able to close on a 3% 7 year ARM with $150k cash out refinance for zero points and zero cost. They even refunded the cost of the appraisal, which was an eye popping $1,200. :shock:

It was through Bank of America, and took 7 weeks, but the process was relatively painless.

The previous loan was also through Bank of America but was 3.125% with 5 years left on the ARM. At the time of getting that loan, the 30 year rates were 4.30%. Based on this, and several other refinancing experiences, in a few years even if the 30 year rate heads back up to 4.5% range, I feel confident I'll get a 5 or 7 year ARM below 4%.

Inframan4712
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Re: Finally got my 3% ARM mortgage

Post by Inframan4712 » Sun Dec 01, 2019 8:05 am

Thanks for the data point. Can you tell us the APR and APY from your loan docs?

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Shackleton
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Re: Finally got my 3% ARM mortgage

Post by Shackleton » Sun Dec 01, 2019 8:11 am

I am about to close on a 3% fixed, 15 year, refinance with no cash out, no points, no appraisal required (because the loan is 20% LTV), fees of $500 because I don't want to escrow T&I (would have been $0 if I did the T&I escrow). 3 weeks from loan app to close.

ARMs make me too nervous - no way could I ever go for one. YMMV
“Superhuman effort isn't worth a damn unless it achieves results.” ~Ernest Shackleton

MarkBarb
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Re: Finally got my 3% ARM mortgage

Post by MarkBarb » Sun Dec 01, 2019 8:49 am

Why the cash out?

I used a similar approach of buying ARMs when buying houses back when we had a mortgage, but my plan was to just pay it off at or near the time that the ARM started to adjust.

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unclescrooge
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Re: Finally got my 3% ARM mortgage

Post by unclescrooge » Sun Dec 01, 2019 12:21 pm

Inframan4712 wrote:
Sun Dec 01, 2019 8:05 am
Thanks for the data point. Can you tell us the APR and APY from your loan docs?
Where would I find that? What will they tell you?

SwampDonkey
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Joined: Sun Dec 26, 2010 8:49 pm

Re: Finally got my 3% ARM mortgage

Post by SwampDonkey » Sun Dec 01, 2019 12:27 pm

Shackleton wrote:
Sun Dec 01, 2019 8:11 am
I am about to close on a 3% fixed, 15 year, refinance with no cash out, no points, no appraisal required (because the loan is 20% LTV), fees of $500 because I don't want to escrow T&I (would have been $0 if I did the T&I escrow). 3 weeks from loan app to close.
Who did you go through? I've been searching recently and the lowest APR I could find was 3.125% w/ ~$1.5k in closing costs added to the loan.

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xyz12
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Re: Finally got my 3% ARM mortgage

Post by xyz12 » Sun Dec 01, 2019 4:12 pm

SwampDonkey wrote:
Sun Dec 01, 2019 12:27 pm
Shackleton wrote:
Sun Dec 01, 2019 8:11 am
I am about to close on a 3% fixed, 15 year, refinance with no cash out, no points, no appraisal required (because the loan is 20% LTV), fees of $500 because I don't want to escrow T&I (would have been $0 if I did the T&I escrow). 3 weeks from loan app to close.
Who did you go through? I've been searching recently and the lowest APR I could find was 3.125% w/ ~$1.5k in closing costs added to the loan.
Very interested in knowing the details as well. I've been shopping for a while trying to get to 15yr fixed at 3.00% APR w/ no points or escrow.

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unclescrooge
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Re: Finally got my 3% ARM mortgage

Post by unclescrooge » Sun Dec 01, 2019 10:28 pm

MarkBarb wrote:
Sun Dec 01, 2019 8:49 am
Why the cash out?

I used a similar approach of buying ARMs when buying houses back when we had a mortgage, but my plan was to just pay it off at or near the time that the ARM started to adjust.
The cash out is to invest in a business.

While nothing is guaranteed in life, and many BHs are keen on paying off their mortgage ahead of schedule, I'm comfortable with the risk.

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Shackleton
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Re: Finally got my 3% ARM mortgage

Post by Shackleton » Mon Dec 02, 2019 8:02 am

xyz12 wrote:
Sun Dec 01, 2019 4:12 pm
SwampDonkey wrote:
Sun Dec 01, 2019 12:27 pm
Shackleton wrote:
Sun Dec 01, 2019 8:11 am
I am about to close on a 3% fixed, 15 year, refinance with no cash out, no points, no appraisal required (because the loan is 20% LTV), fees of $500 because I don't want to escrow T&I (would have been $0 if I did the T&I escrow). 3 weeks from loan app to close.
Who did you go through? I've been searching recently and the lowest APR I could find was 3.125% w/ ~$1.5k in closing costs added to the loan.
Very interested in knowing the details as well. I've been shopping for a while trying to get to 15yr fixed at 3.00% APR w/ no points or escrow.
Aimloan.
“Superhuman effort isn't worth a damn unless it achieves results.” ~Ernest Shackleton

Inframan4712
Posts: 141
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Re: Finally got my 3% ARM mortgage

Post by Inframan4712 » Mon Dec 02, 2019 7:50 pm

unclescrooge wrote:
Sun Dec 01, 2019 12:21 pm
Inframan4712 wrote:
Sun Dec 01, 2019 8:05 am
Thanks for the data point. Can you tell us the APR and APY from your loan docs?
Where would I find that? What will they tell you?
It tells you if you’re really getting 3 percent, and really getting a no cost refinance, or if they rolled some costs into the mortgage.

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unclescrooge
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Re: Finally got my 3% ARM mortgage

Post by unclescrooge » Tue Dec 03, 2019 2:58 am

Inframan4712 wrote:
Mon Dec 02, 2019 7:50 pm
unclescrooge wrote:
Sun Dec 01, 2019 12:21 pm
Inframan4712 wrote:
Sun Dec 01, 2019 8:05 am
Thanks for the data point. Can you tell us the APR and APY from your loan docs?
Where would I find that? What will they tell you?
It tells you if you’re really getting 3 percent, and really getting a no cost refinance, or if they rolled some costs into the mortgage.
It's really a no cost mortgage. The only closing costs were property taxes. Everything else was offset by a $4200 lender credit.
I think the APY is slightly misleading on ARMs.

Inframan4712
Posts: 141
Joined: Sat Jan 03, 2015 1:10 pm

Re: Finally got my 3% ARM mortgage

Post by Inframan4712 » Tue Dec 03, 2019 8:00 am

Thanks, Unclescrooge, and to others who posted. I'll definitely check out BOA along with aimloan.

quizzer25
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Re: Finally got my 3% ARM mortgage

Post by quizzer25 » Wed Dec 04, 2019 2:41 pm

unclescrooge wrote:
Sun Dec 01, 2019 7:36 am
Since there had been a surge in members asking about mortgages recently, I would I would share my experience.

Last week I was able to close on a 3% 7 year ARM with $150k cash out refinance for zero points and zero cost. They even refunded the cost of the appraisal, which was an eye popping $1,200. :shock:

It was through Bank of America, and took 7 weeks, but the process was relatively painless.

The previous loan was also through Bank of America but was 3.125% with 5 years left on the ARM. At the time of getting that loan, the 30 year rates were 4.30%. Based on this, and several other refinancing experiences, in a few years even if the 30 year rate heads back up to 4.5% range, I feel confident I'll get a 5 or 7 year ARM below 4%.
Are you in any of BOA's "preferred" status relationships?

wfrobinette
Posts: 753
Joined: Fri Feb 20, 2015 3:14 pm

Re: Finally got my 3% ARM mortgage

Post by wfrobinette » Wed Dec 04, 2019 5:27 pm

unclescrooge wrote:
Tue Dec 03, 2019 2:58 am
Inframan4712 wrote:
Mon Dec 02, 2019 7:50 pm
unclescrooge wrote:
Sun Dec 01, 2019 12:21 pm
Inframan4712 wrote:
Sun Dec 01, 2019 8:05 am
Thanks for the data point. Can you tell us the APR and APY from your loan docs?
Where would I find that? What will they tell you?
It tells you if you’re really getting 3 percent, and really getting a no cost refinance, or if they rolled some costs into the mortgage.
It's really a no cost mortgage. The only closing costs were property taxes. Everything else was offset by a $4200 lender credit.
I think the APY is slightly misleading on ARMs.
That's a huge lender credit on a 3% rate.

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Topic Author
unclescrooge
Posts: 3982
Joined: Thu Jun 07, 2012 7:00 pm

Re: Finally got my 3% ARM mortgage

Post by unclescrooge » Wed Dec 04, 2019 5:57 pm

wfrobinette wrote:
Wed Dec 04, 2019 5:27 pm
unclescrooge wrote:
Tue Dec 03, 2019 2:58 am
Inframan4712 wrote:
Mon Dec 02, 2019 7:50 pm
unclescrooge wrote:
Sun Dec 01, 2019 12:21 pm
Inframan4712 wrote:
Sun Dec 01, 2019 8:05 am
Thanks for the data point. Can you tell us the APR and APY from your loan docs?
Where would I find that? What will they tell you?
It tells you if you’re really getting 3 percent, and really getting a no cost refinance, or if they rolled some costs into the mortgage.
It's really a no cost mortgage. The only closing costs were property taxes. Everything else was offset by a $4200 lender credit.
I think the APY is slightly misleading on ARMs.
That's a huge lender credit on a 3% rate.
It was 0.37% of the mortgage amount.
Sometimes it pays to carry a large balance. :mrgreen:

seychellois_lib
Posts: 180
Joined: Tue Mar 25, 2014 12:05 am

Re: Finally got my 3% ARM mortgage

Post by seychellois_lib » Wed Dec 04, 2019 7:37 pm

I was feeling pretty good getting 3.5% 30 year fixed on $415K refi 65% LTV. APR = rate. Total cost was $950.00 which I paid out of pocket so I guess I should include that in real APR calc although it wouldn't move the needle much.

I am a bogglehead so good credit goes without saying :D

I like 30 year fixed because I can prepay principal or not depending on financial conditions. I explored ARMS but didn't feel like the savings were worth the loss of flexibility.

Having said this, I had an ARM on a place I sold ten years ago. The first adjust would have been in 2010. I don't think I would have seen an interest rate increase since that time if I had kept the ARM, I don't recall the exact terms but I may have actually seen a rate drop. Dang... who woulda thought.

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unclescrooge
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Joined: Thu Jun 07, 2012 7:00 pm

Re: Finally got my 3% ARM mortgage

Post by unclescrooge » Wed Dec 04, 2019 8:21 pm

seychellois_lib wrote:
Wed Dec 04, 2019 7:37 pm
I was feeling pretty good getting 3.5% 30 year fixed on $415K refi 65% LTV. APR = rate. Total cost was $950.00 which I paid out of pocket so I guess I should include that in real APR calc although it wouldn't move the needle much.

I am a bogglehead so good credit goes without saying :D

I like 30 year fixed because I can prepay principal or not depending on financial conditions. I explored ARMS but didn't feel like the savings were worth the loss of flexibility.

Having said this, I had an ARM on a place I sold ten years ago. The first adjust would have been in 2010. I don't think I would have seen an interest rate increase since that time if I had kept the ARM, I don't recall the exact terms but I may have actually seen a rate drop. Dang... who woulda thought.
On my previous house, i refinanced my ARM 4 times in 2.5 years. Each time I got a lower rate at no cost.

We were in the middle of another refinance when my wife declared we were selling and moving :oops:

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