Refinance Mega Thread

[Ramjet]

Why are refinance rates always higher than first time purchase rates?

Never understood this either

[abuss368]

Why are refinance rates always higher than first time purchase rates?

Never understood this either

I would expect the cost to structure a mortgage on an original purchase to be higher than refinancing an existing mortgage.

[bbqguru]

Another data point- getting ready to lock in a 2.25% for 15 years through US Wide Financial for $160k. Had to pay 2.91 points to get that low, but they have been the only company I can find to get that low.

Even with the points and taking into account total interest paid on current loan, we're going to save around 2 years in payments and $12k in interest.

[bbqguru]

duplicate post

[prozario01]

I don't know where people are getting these great Lenderfi results, but they are garbage for me. Current mortgage around 80K 3.75%, home value 300k+ and the best Lenderfi can give me is 3.6 for a 30 and 4.125 for a 15 year. What the heck? Credit score 800+

Costco was just as terrible.

Could be because $80K is too low .. try something with over $100K just to see if that is the issue. They probably have a threashold loan amount where they make money.

[amindu]

Anyone got a good rate in NV? I'm not finding anyone who can get anywhere near 3.25% no fee, let alone 3%. And today's rate is actually higher than yesterday.

NV as in Nevada? If so OneNevada Credit Union by far the lowest rate and underwriting fees ($560). I locked in a 2.5 15 year with 1/8 credit, plus lender and title cost. If interest i can get you the info to the loan officer.

[e5116]

Why are refinance rates always higher than first time purchase rates?

Never understood this either

I would expect the cost to structure a mortgage on an original purchase to be higher than refinancing an existing mortgage.

Refinance has a much larger risk of people backing out....If you're buying a new house, you need to close to get in the house. If you're refinancing, you get to still stay in the house if it doesn't go through. There's a larger perceived risk to the bank.

[gndibot]

Thank you to the poster who mentioned about Costco. Super helpful.

I have a quote from Consumer Direct Mortgage(part of First Bank) for a refinance rate of 3.25% at zero down. I am currently at a 3.625% 30 year fixed. Has anybody worked with them here and have any opinions? Never heard of them before. My home is in CA.

Here is the quote I received and it sounds too good to be true

Monthly Mortgage Payment

Principal and Interest $3,303.22
Mortgage Insurance $0.00
Total Monthly Payment $3,303.22

Closing Cost Estimate
Lender Fees / (Credits)
Origination Fees $175.00
Lender Credit ($2,793.12)
Sub Total ($2,618.12)

Third Party Charges
Appraisal Fees $445.00
Credit Report $76.76
Flood Certification $9.00
Tax Service Fee $70.00
Title - Settlement Fee $495.00
Title - Lender's title insurance $700.00
Title - Recording Service Fee $18.00
Taxes and Other Government Fees
Mortgage Recording Fee $89.00
Building Homes and Jobs Act Fee $150.00
Sub Total $2,052.76
Total Closing Cost $0.00
Estimated Total Cash Needed at Closing $0.00

[manuvns]

Why are refinance rates always higher than first time purchase rates?

Never understood this either

probably because people are looking to take the cash out of the appreciated house , BTW what is the best rate on 5/1 arm now my local credit union is offering 3% rate for 95% LTV with no origination and no PMI . Can i do better than this ?

[Count of Notre Dame]

My current bank (First Republic) is offering a loan modification for $2k to extend the fixed term of my 7/1 ARM at 3% with 6 years left on the fixed period, to 10/1 ARM at 3%. Is that worth doing if I'm receiving a lender credit to get my net closing costs to negative $1.7k? Should I tell my current bank to pound sand?

[BruDude]

Interesting tidbit - someone looking at buying my car is a mortgage broker and was telling me that they are so busy that they've artificially raised the rates a little just to stem the flow of people calling and applying since they can't handle it all. If that is correct, I suspect the rates will come down a bit more once the initial rush is over. Looks like rates went up .0125% most places today.

[livelifealittle]

NV as in Nevada? If so OneNevada Credit Union by far the lowest rate and underwriting fees ($560). I locked in a 2.5 15 year with 1/8 credit, plus lender and title cost. If interest i can get you the info to the loan officer.

Yes, Nevada. That would be much appreciated. Thank you!

[BruDude]

NV as in Nevada? If so OneNevada Credit Union by far the lowest rate and underwriting fees ($560). I locked in a 2.5 15 year with 1/8 credit, plus lender and title cost. If interest i can get you the info to the loan officer.

Yes, Nevada. That would be much appreciated. Thank you!

Can you send me the loan officer info too? I have been trying to get through to their mortgage department for a week but nobody has called me back yet. They did raise the rate on 15-year to 2.625% today, it was 2.5% yesterday.

[atxll]

I don't know where people are getting these great Lenderfi results, but they are garbage for me. Current mortgage around 80K 3.75%, home value 300k+ and the best Lenderfi can give me is 3.6 for a 30 and 4.125 for a 15 year. What the heck? Credit score 800+

Costco was just as terrible.

Same here, I wonder if it has to do with being in TX? I just checked rates on Lenderfi, would be around 44% LTV, 800+ credit score. Not seeing anything lower than the rate I already have (2.75% on a 15 year) even with shorter loan durations. The only rates lower than that had massive closing costs.

[Dongle]

Looking for recommendations as a first time refinancer. I got a rate lock at 3% on 30 year mortgage, no points. It's good for two months. My thought is, why rush the closing process? My LO will match any executed loan estimate from another lender. So if I wait to see if rates go down, that will put me in the best possible position.

Is my thinking correct?

[abuss368]

Why are refinance rates always higher than first time purchase rates?

Never understood this either

I would expect the cost to structure a mortgage on an original purchase to be higher than refinancing an existing mortgage.

Refinance has a much larger risk of people backing out....If you're buying a new house, you need to close to get in the house. If you're refinancing, you get to still stay in the house if it doesn't go through. There's a larger perceived risk to the bank.

That makes sense. Is that the only reason for the higher mortgage interest rate?

[MDfan]

We have a 20-year rate of 3.375% with about 16 years left. Does it make any sense for us to refinance? Maybe to a 15-year?

15 year you could get at 3% with no cost .. maybe slightly lower - why not.

Was actually able to get a 15-year no points loan at 2.625% from a mortgage broker I've used before in MD. Payment stays essentially the same and it saves us almost $30k in interest.

[psychoslowmatic]

Anyone have experience refi’ing investment loans? Looking for places to check.

[bandoba]

I've couple of questions:

• When you guys get these offers, are you letting lenders pull the credit? Is it with the assumption that multiple credit pulls in short duration don't matter?
• I see 2.625% refi has 5K additional interest over 15 year term compared to 2.50% refi for 15 years based on amortization. So in this case even if 2.50% refi has closing cost of $800, it is still better isn't it? Is there any other data point to compare?

[ChiKid24]

When people talk about a "no cost" refinance, is it assumed that you still have to pay title fees?

Nope. No cost should mean no expenses. Generally that involves the lender giving you a credit (or negative points) which cover things like title fees, appraisal, credit, etc. Only thing you might have to pay out of pocket would be prepaids like interest or property taxes, but those are things you would be paying anyway at some point in the near term.

[MDfan]

I've couple of questions:

• When you guys get these offers, are you letting lenders pull the credit? Is it with the assumption that multiple credit pulls in short duration don't matter?
• I see 2.625% refi has 5K additional interest over 15 year term compared to 2.50% refi for 15 years based on amortization. So in this case even if 2.50% refi has closing cost of $800, it is still better isn't it? Is there any other data point to compare?

I don't know, but I'm happy with what we got.

[ChiKid24]

I've couple of questions:

• When you guys get these offers, are you letting lenders pull the credit? Is it with the assumption that multiple credit pulls in short duration don't matter?
• I see 2.625% refi has 5K additional interest over 15 year term compared to 2.50% refi for 15 years based on amortization. So in this case even if 2.50% refi has closing cost of $800, it is still better isn't it? Is there any other data point to compare?

Correct. The initial credit pull will be a small ding, but subsequent ones as you shop lenders shouldn't impact if done within a short period of time which I believe is 45 days.

[rhinopylon]

When people talk about a "no cost" refinance, is it assumed that you still have to pay title fees?

Nope. No cost should mean no expenses. Generally that involves the lender giving you a credit (or negative points) which cover things like title fees, appraisal, credit, etc. Only thing you might have to pay out of pocket would be prepaids like interest or property taxes, but those are things you would be paying anyway at some point in the near term.

Ok thank you for answering. In this case, the Costco lenders do not seem to be "No Cost". But they do seem to be pretty "Low Cost". At least in my case, the cost is worth it. The net costs for a 30 year is $995 and a 15 year is $1205 with the option of another $450 deduction if the appraisal is waived.

Even without the appraisal waiver, in my situation, I'll make the costs back in like two months.

[unclescrooge]

Another data point- getting ready to lock in a 2.25% for 15 years through US Wide Financial for $160k. Had to pay 2.91 points to get that low, but they have been the only company I can find to get that low.

Even with the points and taking into account total interest paid on current loan, we're going to save around 2 years in payments and $12k in interest.

If you can get 2.75 at no cost, then the break even is 6 years. Personally, I wouldn't take this loan but to each his own.

[bryansmile]

Where do you guys go to shop for title insurance for the refinance?

[user280]

I'm curious on that, too...

For Section C, Better is quoting me $1400:

Lenders title insurance $850
Title settlement fee $550

The vendor they're using is Title365 Company, based in Coraopolis, PA 15108. My property is in California.

Is there any advantage to going with their default partner (and thereby forfeiting any cost savings by shopping)?

[LFKB]

10 year interest only at 2.375% with 0.5 points rebate thru BofA (Citi also made the same offer)

~$4k in closing costs
$7.5k rebate
Leaves about $3.5k to cover portion of first months payment

[dukeblue219]

Refinance has a much larger risk of people backing out....If you're buying a new house, you need to close to get in the house. If you're refinancing, you get to still stay in the house if it doesn't go through. There's a larger perceived risk to the bank.

I wonder if a person who refinances once is also much more likely to refinance again in the future, reducing the resale value of a refinanced loan vs an original loan from a person who might just blissfully pay their same rate for 30 years.

[boston85]

10 year interest only at 2.375% with 0.5 points rebate thru BofA (Citi also made the same offer)

~$4k in closing costs
$7.5k rebate
Leaves about $3.5k to cover portion of first months payment

Are you saying that is a 10 year mortgage, or a 10 year ARM? Also, what is the LTV and total mortgage amount on that?

[Renzi]

I just was conditionally approved on LenderFi. TX, $410,000 Home Value, $348,000 Outstanding current 4.125% currently, 9 month in to 30 year, 1800 monthly 2800 with taxes/insurance. Pay $3000 month and would like to not go above that, but could do 15. Expect to be in the home at least 5 years, and if I move I may keep the house as a rental in any case (29).

Thinking about pulling the trigger on the 30 year no cost at 3.375%, or the 2.25% 15 year. I like the no cost as its no risk, but 2.25% 15 year seems tempting and could save me a ton and love the idea of it being paid off before 45. Title fees in TX are 2k+, this is about what I paid for current mortgage as well. LenderFi rates are much lower than anywhere else I've found.

30 YEAR

2.750% 2.961% $1,423 $6,827 [$10,000 COST]
2.875% 3.027% $1,446 $4,161
3.000% 3.094% $1,469 $1,520
3.125% 3.186% $1,493 ($972 credit)
3.250% 3.312% $1,517 ($3,011 credit)
3.375% 3.438% $1,541 ($3,759 credit) [NO COST]

15 YEAR

2.250% 2.478% $2,283 $4,632 [8,000 Cost]
2.375% 2.522% $2,303 $2,652
2.500% 2.570% $2,324 $753
2.625% 2.664% $2,344 ($896 credit)
2.750% 2.789% $2,365 ($2,318 credit)
2.875% 2.916% $2,386 ($3,569 credit)
3.000% 3.041% $2,407 ($3,759 credit) [NO COST]

[Thorsbane]

I don't seem to have any good options for refinance.

Remaining Mortgage: ~$120,000
Current Rate: 3.75%
Current Term: 30 year fixed

I am aggressive toward my mortgage and focus on paying about $1,000 of principal per month (so effectively 10 years left).


When I search, I look into 15 year fixed and see rates of 2.75% with random banks that I've never heard of. All costs for closing are presented as close to $2.5k. For that savings and at my balance, it would take about 2-3 years to recoup the expense via lower interest if I continue my payment patterns.

Am I thinking about this properly?

[prozario01]

thanks to the poster who mentioned COSTCO ... didn't know about it, just tried it out and got the lowest rate so far ... Mutual of Omaha - 30 year at 2.75% - they pay appraisal fee - and rest of the cost are mine. I pay cost negotiated fee of $175 or so, plus title insurance. Waiting for full estimate. If i take 3% .. they give me rebate of around $1,700 to cover closing cost (plus part of the deal is they pay appraisal fee). Better for me compared to LoanDepot & few others i checked.

What state is that for?

The lowest I'm showing for a 15 is 3.125%

I am in NJ. Online for me it showed 3.125% for 30 years. I basically picked the lowest rate - Mutual of Omaha. When i applied with basic info, got an email with name/contact - when i called the guy gave me lower rate over phone. In theory you could try more than one lender - I'm already dealing with 2 others, so didn't want to bother - just tried lowest one from costco.

I'm guessing the online rate is not always upto date.

i made another post .. upon follow up, the guy gave me wrong info .. he was quoting 15 year, and thinking it was 30 year. Today i have him checked again - he said rate didn't change, but now says 3% .. then i realized what he did. So it is 3% for 30 years for NJ, and 2.75% rate is for 15 years. But still it seems to be lowest so far, as they cover apprisal fee, and their bank fee is capped at $175 by costco. I'm waiting for estimate sheet .. they said they'll send it tonight.

I'm tempted to go with 15 year .. but it is bit too tight in terms of monthly payment.

That rate seems too good to be true, I'd check the fine print.

Finally got the fine print. So 3% for 30 years with total closing cost of $2,300 - includes appraisal $445, title stuff around $1300, and NJ transfer tax of around $300, and $175 flat bank fee. They did say they will refund me $445 appraisal cost .. so that should bring it down to $1,700 - although i could not find it in writing - they told me they should be in writing (didn't read all the docs). So just appraisal cost need to confirm. Only annoying charge is the $50 or so credit check and floor certification .. within that $2,300 total

[crit]

I'm thinking about refi. Currently have 3.44%, $210k balance, house ~$350k, in PA, excellent credit & income. We're 5 years into a 30-year. We can afford a 15-year payment.

Costco online gave me best quotes of 3.375% for a 30 year and 2.99% for a 15-year.

This doesn't seem that great. Where else should I look to do better?

Should I bother calling our mortgage holder (TD) and seeing if they'd like to lower our rate before they lose us?

[prozario01]

What state is that for?

The lowest I'm showing for a 15 is 3.125%

I am in NJ. Online for me it showed 3.125% for 30 years. I basically picked the lowest rate - Mutual of Omaha. When i applied with basic info, got an email with name/contact - when i called the guy gave me lower rate over phone. In theory you could try more than one lender - I'm already dealing with 2 others, so didn't want to bother - just tried lowest one from costco.

I'm guessing the online rate is not always upto date.

i made another post .. upon follow up, the guy gave me wrong info .. he was quoting 15 year, and thinking it was 30 year. Today i have him checked again - he said rate didn't change, but now says 3% .. then i realized what he did. So it is 3% for 30 years for NJ, and 2.75% rate is for 15 years. But still it seems to be lowest so far, as they cover apprisal fee, and their bank fee is capped at $175 by costco. I'm waiting for estimate sheet .. they said they'll send it tonight.

I'm tempted to go with 15 year .. but it is bit too tight in terms of monthly payment.

That rate seems too good to be true, I'd check the fine print.

Finally got the fine print. So 3% for 30 years with total closing cost of $2,300 - includes appraisal $445, title stuff around $1300, and NJ transfer tax of around $300, and $175 flat bank fee. They did say they will refund me $445 appraisal cost .. so that should bring it down to $1,700 - although i could not find it in writing - they told me they should be in writing (didn't read all the docs). So just appraisal cost need to confirm. Only annoying charge is the $50 or so credit check and floor certification .. within that $2,300 total

Now I am really annoyed .. guy says I pay first then they give me credit for it WTF!!! Why even bring that up? You pay for $500 upfront, and we add another $500 charge in closing and then we give you $500 credit!!!! SO essentially it is roundabout way of saying I pay appraisal fee. So closing cost it $2,300. Bit shady. On $260K loan, they are only giving me about $1,200 credit if I go to 3.25.

[AerialWombat]

I am in NJ. Online for me it showed 3.125% for 30 years. I basically picked the lowest rate - Mutual of Omaha. When i applied with basic info, got an email with name/contact - when i called the guy gave me lower rate over phone. In theory you could try more than one lender - I'm already dealing with 2 others, so didn't want to bother - just tried lowest one from costco.

I'm guessing the online rate is not always upto date.

i made another post .. upon follow up, the guy gave me wrong info .. he was quoting 15 year, and thinking it was 30 year. Today i have him checked again - he said rate didn't change, but now says 3% .. then i realized what he did. So it is 3% for 30 years for NJ, and 2.75% rate is for 15 years. But still it seems to be lowest so far, as they cover apprisal fee, and their bank fee is capped at $175 by costco. I'm waiting for estimate sheet .. they said they'll send it tonight.

I'm tempted to go with 15 year .. but it is bit too tight in terms of monthly payment.

That rate seems too good to be true, I'd check the fine print.

Finally got the fine print. So 3% for 30 years with total closing cost of $2,300 - includes appraisal $445, title stuff around $1300, and NJ transfer tax of around $300, and $175 flat bank fee. They did say they will refund me $445 appraisal cost .. so that should bring it down to $1,700 - although i could not find it in writing - they told me they should be in writing (didn't read all the docs). So just appraisal cost need to confirm. Only annoying charge is the $50 or so credit check and floor certification .. within that $2,300 total

Now I am really annoyed .. guy says I pay first then they give me credit for it WTF!!! Why even bring that up? You pay for $500 upfront, and we add another $500 charge in closing and then we give you $500 credit!!!! SO essentially it is roundabout way of saying I pay appraisal fee. So closing cost it $2,300. Bit shady. On $260K loan, they are only giving me about $1,200 credit if I go to 3.25.

Are you already on the hook to close? There are much better deals to be had.

[WanderingPothos]

Ok, sorry if this is a really basic question but I have searched the forum and Googled, but can't seem to get a straight answer. I get that I am ultimately paying somewhere down the line, but is a "no cost" refi specifically in regards to $0 lender fees and third party credits? Or are some people including recording fees and transfer taxes (and just confirming if they are dependent on state?)? I'm in Florida and with $1000ish in recording/transfer costs, I can't get below a 4.0% interest rate and that is still paying about $500-1000 in something. Does this sound right or am I confused?

Is anyone in Florida getting rates below 4% and paying nothing up front? I am a newbie and have never refinanced before. Thanks!

[AerialWombat]

Ok, sorry if this is a really basic question but I have searched the forum and Googled, but can't seem to get a straight answer. I get that I am ultimately paying somewhere down the line, but is a "no cost" refi specifically in regards to $0 lender fees and third party credits? Or are some people including recording fees and transfer taxes (and just confirming if they are dependent on state?)? I'm in Florida and with $1000ish in recording/transfer costs, I can't get below a 4.0% interest rate and that is still paying about $500-1000 in something. Does this sound right or am I confused?

Is anyone in Florida getting rates below 4% and paying nothing up front? I am a newbie and have never refinanced before. Thanks!

"No cost" usually means that you're getting enough back in lender credits -- in exchange for a higher interest rate -- that it covers all those pesky fees.

In some parts of the country, it can be very difficult to achieve a true no-cost refi, because everywhere has different pricing for things. For example, the house I just bought had a $900 appraisal fee, which is typical around here. A different state that I buy properties in has a norm of around $450 for an appraisal, so half of what it is here. Recording fees here are also about quadruple in that other state, same issue you're experiencing. Title insurance rates can also different dramatically across regions.

On the house I just bought, which I locked several a full month before the recent crash in mortgage rates started, I accepted a rate of 4.75% on a 30-year fixed in order to get a massive lender credit that paid absolutely *everything* except my down payment -- even the pre-paid interest and escrow. After settlement and recording, the title company cut me a rebate check, even, because I had paid for the appraisal out of pocket before closing. In my other state, at the same time, I could have gone to only 4.25% because I didn't need as big of a lender credit, because all the fees are just lower out there.

I hope that helps. Bottom line, keep shopping. Check all the usual suspects (Aimlon, Lenderfi, Loan Depot, your credit union, etc). Best of luck!

[prozario01]

i made another post .. upon follow up, the guy gave me wrong info .. he was quoting 15 year, and thinking it was 30 year. Today i have him checked again - he said rate didn't change, but now says 3% .. then i realized what he did. So it is 3% for 30 years for NJ, and 2.75% rate is for 15 years. But still it seems to be lowest so far, as they cover apprisal fee, and their bank fee is capped at $175 by costco. I'm waiting for estimate sheet .. they said they'll send it tonight.

I'm tempted to go with 15 year .. but it is bit too tight in terms of monthly payment.

That rate seems too good to be true, I'd check the fine print.

Finally got the fine print. So 3% for 30 years with total closing cost of $2,300 - includes appraisal $445, title stuff around $1300, and NJ transfer tax of around $300, and $175 flat bank fee. They did say they will refund me $445 appraisal cost .. so that should bring it down to $1,700 - although i could not find it in writing - they told me they should be in writing (didn't read all the docs). So just appraisal cost need to confirm. Only annoying charge is the $50 or so credit check and floor certification .. within that $2,300 total

Now I am really annoyed .. guy says I pay first then they give me credit for it WTF!!! Why even bring that up? You pay for $500 upfront, and we add another $500 charge in closing and then we give you $500 credit!!!! SO essentially it is roundabout way of saying I pay appraisal fee. So closing cost it $2,300. Bit shady. On $260K loan, they are only giving me about $1,200 credit if I go to 3.25.

Are you already on the hook to close? There are much better deals to be had.

no .. didn't sign anything much yet. Which better sites? Two best deal i have so far:

1) Costco - Omaha bank: 3.0% fro 30 year with closing cost of $2,300 (they don't have good deal for negative rate - only $1,200 credit if i got to 3.25%)
2) Loandepot - 3.25% for 30 years with no closing cost

[ChiKid24]

I am in NJ. Online for me it showed 3.125% for 30 years. I basically picked the lowest rate - Mutual of Omaha. When i applied with basic info, got an email with name/contact - when i called the guy gave me lower rate over phone. In theory you could try more than one lender - I'm already dealing with 2 others, so didn't want to bother - just tried lowest one from costco.

I'm guessing the online rate is not always upto date.

i made another post .. upon follow up, the guy gave me wrong info .. he was quoting 15 year, and thinking it was 30 year. Today i have him checked again - he said rate didn't change, but now says 3% .. then i realized what he did. So it is 3% for 30 years for NJ, and 2.75% rate is for 15 years. But still it seems to be lowest so far, as they cover apprisal fee, and their bank fee is capped at $175 by costco. I'm waiting for estimate sheet .. they said they'll send it tonight.

I'm tempted to go with 15 year .. but it is bit too tight in terms of monthly payment.

That rate seems too good to be true, I'd check the fine print.

Finally got the fine print. So 3% for 30 years with total closing cost of $2,300 - includes appraisal $445, title stuff around $1300, and NJ transfer tax of around $300, and $175 flat bank fee. They did say they will refund me $445 appraisal cost .. so that should bring it down to $1,700 - although i could not find it in writing - they told me they should be in writing (didn't read all the docs). So just appraisal cost need to confirm. Only annoying charge is the $50 or so credit check and floor certification .. within that $2,300 total

Now I am really annoyed .. guy says I pay first then they give me credit for it WTF!!! Why even bring that up? You pay for $500 upfront, and we add another $500 charge in closing and then we give you $500 credit!!!! SO essentially it is roundabout way of saying I pay appraisal fee. So closing cost it $2,300. Bit shady. On $260K loan, they are only giving me about $1,200 credit if I go to 3.25.

This is their way of making it so you have skin in the game. By paying the $500 up front, you are less likely to continue shopping with other lenders or cancel during the process if rates continue to fall. If I were a lender, I'd probably do the same thing. It's not like they aren't doing any work on their end processing your documents, reviewing your application, putting on a rate lock, etc. To do all that and then have you back out isn't cost-less to them.

[prozario01]

i made another post .. upon follow up, the guy gave me wrong info .. he was quoting 15 year, and thinking it was 30 year. Today i have him checked again - he said rate didn't change, but now says 3% .. then i realized what he did. So it is 3% for 30 years for NJ, and 2.75% rate is for 15 years. But still it seems to be lowest so far, as they cover apprisal fee, and their bank fee is capped at $175 by costco. I'm waiting for estimate sheet .. they said they'll send it tonight.

I'm tempted to go with 15 year .. but it is bit too tight in terms of monthly payment.

That rate seems too good to be true, I'd check the fine print.

Finally got the fine print. So 3% for 30 years with total closing cost of $2,300 - includes appraisal $445, title stuff around $1300, and NJ transfer tax of around $300, and $175 flat bank fee. They did say they will refund me $445 appraisal cost .. so that should bring it down to $1,700 - although i could not find it in writing - they told me they should be in writing (didn't read all the docs). So just appraisal cost need to confirm. Only annoying charge is the $50 or so credit check and floor certification .. within that $2,300 total

Now I am really annoyed .. guy says I pay first then they give me credit for it WTF!!! Why even bring that up? You pay for $500 upfront, and we add another $500 charge in closing and then we give you $500 credit!!!! SO essentially it is roundabout way of saying I pay appraisal fee. So closing cost it $2,300. Bit shady. On $260K loan, they are only giving me about $1,200 credit if I go to 3.25.

This is their way of making it so you have skin in the game. By paying the $500 up front, you are less likely to continue shopping with other lenders or cancel during the process if rates continue to fall. If I were a lender, I'd probably do the same thing. It's not like they aren't doing any work on their end processing your documents, reviewing your application, putting on a rate lock, etc. To do all that and then have you back out isn't cost-less to them.

I didn't pay the $500 yet .. they took the credit card before, but they said they'll call me etc to schedule before that part proceeds. I think the guy i am dealing with is a junior guy just mixing thing up. They have not locked anything yet - they just gave me the estimate sheet today.
I told them to give me an estimate sheet .. and this is where I am right now.

They could do a quick estimate sheet first, with everything written down .. and then I can decide - easy for them and for me.

[mw1739]

Currently 7 years into a 3.75% 30 year mortgage. Submitted application today for 2.75% 20 year mortgage. Payment stays roughly the same and cuts 3 years off the mortgage. The payment jump to a 15 year is too much for my liking since this isn't likely our forever home.

[rhinopylon]

Just to give people another datapoint:

I locked in with a Costco lender for a 15 year @ 2.75%. Total closing fees will be $1895 minus a lender credit of $690. Net closing fees that I'll pay out of pocket will then be $1205. During the application process, we will find out of the $450 appraisal fee will not be needed. If it is not needed, it will bring my net costs down to $755. In either case, at $1205 or $755, I'm happy with the cost and massive interest rate drop from my previous rate.

Thanks all for the heads up on using Costco. This forum, once again, proves a good site to lurk on.

[kinless]

LenderFi finally called me back and was able to lock in a 20-year @ 3.125% at NO cost! This slices off $120/mo in payments and also reduces yearly interest by $2,000+. Couldn't find anything else under 3.25% no cost from all the different lenders I tried, so I'll take it.

But with my luck, in a month I'll be sitting here deflated while y'all complain that you can't find a no-cost loan under 2.5%.

[prozario01]

Just to give people another datapoint:

I locked in with a Costco lender for a 15 year @ 2.75%. Total closing fees will be $1895 minus a lender credit of $690. Net closing fees that I'll pay out of pocket will then be $1205. During the application process, we will find out of the $450 appraisal fee will not be needed. If it is not needed, it will bring my net costs down to $755. In either case, at $1205 or $755, I'm happy with the cost and massive interest rate drop from my previous rate.

Thanks all for the heads up on using Costco. This forum, once again, proves a good site to lurk on.

nice .. is this consumer direct through costco? Any chance did they mention 30 year rate?

[rhinopylon]

Just to give people another datapoint:

I locked in with a Costco lender for a 15 year @ 2.75%. Total closing fees will be $1895 minus a lender credit of $690. Net closing fees that I'll pay out of pocket will then be $1205. During the application process, we will find out of the $450 appraisal fee will not be needed. If it is not needed, it will bring my net costs down to $755. In either case, at $1205 or $755, I'm happy with the cost and massive interest rate drop from my previous rate.

Thanks all for the heads up on using Costco. This forum, once again, proves a good site to lurk on.

nice .. is this consumer direct through costco? Any chance did they mention 30 year rate?

Yep, Consumer Direct. Their 30 year rate was 3.125, although when I go through the Costco search again, all the rates have crept up since I searched the first time. Maybe they'll drop again next week?

[prozario01]

Just to give people another datapoint:

I locked in with a Costco lender for a 15 year @ 2.75%. Total closing fees will be $1895 minus a lender credit of $690. Net closing fees that I'll pay out of pocket will then be $1205. During the application process, we will find out of the $450 appraisal fee will not be needed. If it is not needed, it will bring my net costs down to $755. In either case, at $1205 or $755, I'm happy with the cost and massive interest rate drop from my previous rate.

Thanks all for the heads up on using Costco. This forum, once again, proves a good site to lurk on.

nice .. is this consumer direct through costco? Any chance did they mention 30 year rate?

Yep, Consumer Direct. Their 30 year rate was 3.125, although when I go through the Costco search again, all the rates have crept up since I searched the first time. Maybe they'll drop again next week?

Thanks for the response. I just called them .. i got 3.375 plus closing cost of $2800 or so- no credit or anything. Could be based on location - i am in nj. I will stick with Omaha/Costco - 3% for 30 years with $2300 closing cost or 2.75% for 15 with same closing. That's best i have so far.

[LiarsDice]

LenderFi finally called me back and was able to lock in a 20-year @ 3.125% at NO cost! This slices off $120/mo in payments and also reduces yearly interest by $2,000+. Couldn't find anything else under 3.25% no cost from all the different lenders I tried, so I'll take it.

But with my luck, in a month I'll be sitting here deflated while y'all complain that you can't find a no-cost loan under 2.5%.

Keep in mind LenderFI has you sign a document stating that you will keep the loan for 6 months and if you don't, you forfeit all lender credits that cover costs. Therefore if rates fall - which appears likely - you'll not be able to do another refinance until the 6 month mark. So while their rates may be lower and appear more wholesale relative to other lenders, it does come with a fairly large stipulation, especially in this environment. I opted to go elsewhere and got the same no cost rate, locked in on the first day for free and no prepayment penalty.

[kinless]

Keep in mind LenderFI has you sign a document stating that you will keep the loan for 6 months and if you don't, you forfeit all lender credits that cover costs. Therefore if rates fall - which appears likely - you'll not be able to do another refinance until the 6 month mark. So while their rates may be lower and appear more wholesale relative to other lenders, it does come with a fairly large stipulation, especially in this environment. I opted to go elsewhere and got the same no cost rate, locked in on the first day for free and no prepayment penalty.

Yah I noticed that little clause while signing the loan doc. That's OK though, wasn't planning on chasing rates. Took me 10 years to refinance after all, so unless mortgage rates drop under 2.5% at no cost, it won't be worth forfeiting the $1,438 in lending credits.

[dogagility]

Just did a rate relock of my current ARM at Third Federal. Terms were 5/1 ARM at 2.85% with $295 closing costs. Only needed to do a simple, 3 minute phone call.

This thread got me thinking about refinancing, and the refinance will save us about $4000 over the next two years.

Thanks again, Bogleheads!

[WanderingPothos]

"No cost" usually means that you're getting enough back in lender credits -- in exchange for a higher interest rate -- that it covers all those pesky fees.

In some parts of the country, it can be very difficult to achieve a true no-cost refi, because everywhere has different pricing for things.

Thank you so much for your post! I was getting the impression that people that were able to get great deals probably had low costs (e.g. <$2k, sans escrow/prepaids) to begin with, just wasn't sure if that was completely the case (you don't know what you don't know, and all that). I did try the usual suspects you listed...will keep up the watchful waiting.