Refinance Mega Thread

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topcatin
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Re: Refinance Mega Thread

Post by topcatin »

ChiKid24 wrote: Fri Jul 17, 2020 4:30 pm
topcatin wrote: Fri Jul 17, 2020 3:53 pm Hi,
What are the consequences if the appraisal comes lower than the value you entered when applying?
Based on 2 banks, they came up with a value way above what I thought, so I used that number for my current refinance.
My loan amt is 200k and I think my house can sell for $320k - $330k just based on recent comps.
What if the appraiser comes up with a number like $305k - $315k?
Rates are based on specific LTVs (Loan to Value). Good pricing starts at 75% LTV, some may offer better pricing at lower LTVs (65%, 50%, etc.) But I'm not sure how that secret sauce works. With a $200k loan amount, you are well below 75%. Even if the appriasal comes out at $300k you are at 66.7% If you trigger one of the thresholds and they increase your rate, you can probably ask your loan officer if you can pay down the loan a bit to bring the LTV back in line.
Thank you ChiKid, the loan officer I spoke to initially mentioned the rates can change based on LTV and then said "Your home will go for atleast 300k right?" so I am hoping that is a good sign or the limit.
topcatin
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Re: Refinance Mega Thread

Post by topcatin »

BrandonBogle wrote: Fri Jul 17, 2020 5:04 pm
ChiKid24 wrote: Fri Jul 17, 2020 4:30 pm
topcatin wrote: Fri Jul 17, 2020 3:53 pm Hi,
What are the consequences if the appraisal comes lower than the value you entered when applying?
Based on 2 banks, they came up with a value way above what I thought, so I used that number for my current refinance.
My loan amt is 200k and I think my house can sell for $320k - $330k just based on recent comps.
What if the appraiser comes up with a number like $305k - $315k?
Rates are based on specific LTVs (Loan to Value). Good pricing starts at 75% LTV, some may offer better pricing at lower LTVs (65%, 50%, etc.) But I'm not sure how that secret sauce works. With a $200k loan amount, you are well below 75%. Even if the appriasal comes out at $300k you are at 66.7% If you trigger one of the thresholds and they increase your rate, you can probably ask your loan officer if you can pay down the loan a bit to bring the LTV back in line.
Stealing VCC's post from another thread to highlight the above conversation/questions. It makes sense that sub-60% LTV is getting the best pricing, in addition to above $300k loan balances.
VCC wrote: Fri Jul 17, 2020 4:08 pm Fannie Mae charges a 0.5% fee for 30 yr loans at 75.01-80% LTV, which on a 300k loan is $1500. 60.01-75% LTV is 0.25%, or $750 on a 300k loan. 60% LTV & below have no fee. All of these fees can be found on the Fannie Mae LLPA table.
Thank you BrandonBogle!
gerbilunit
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Re: Refinance Mega Thread

Post by gerbilunit »

Still learning and reading a lot on this mega thread and there's a ton of good information. I wanted to ask the pro's here if this is considered typical.

LenderFi came back with 2.75 30 yr. The lender credit shows $1400 which covers everything except for letter F which is the pre-paids. Specifically the Prepaid interest amount. When everyone talks about 0 fee, is it considered not a great deal if the lender fee doesn't cover the prepaid interest amount? If I was to not have that balance, my lender credit would be $95 in my favor.

Sorry if this is a noob question, just trying to digest all of this information as quickly as possible and see if this is a good deal.
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truenyer
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Re: Refinance Mega Thread

Post by truenyer »

gerbilunit wrote: Fri Jul 17, 2020 6:18 pm Still learning and reading a lot on this mega thread and there's a ton of good information. I wanted to ask the pro's here if this is considered typical.

LenderFi came back with 2.75 30 yr. The lender credit shows $1400 which covers everything except for letter F which is the pre-paids. Specifically the Prepaid interest amount. When everyone talks about 0 fee, is it considered not a great deal if the lender fee doesn't cover the prepaid interest amount? If I was to not have that balance, my lender credit would be $95 in my favor.

Sorry if this is a noob question, just trying to digest all of this information as quickly as possible and see if this is a good deal.
Considering you have to pay interest, taxes, and insurance no matter what, yes a "no cost" refi is where the only thing you have to bring to table is taxes, insurance, and interest.

For example, I just locked with LoanDepot and they are giving me a $4500 credit, which turns into a net $1800 lender credit that will be applied to my interest/insurance/property taxes at closing.
Soares1234
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Re: Refinance Mega Thread

Post by Soares1234 »

Hoodwink wrote: Mon Jul 13, 2020 7:04 pm Should I lock on a rate of 2.5% with 5K in lender fees for 510K loan amount? This is with lenderfi. If i go 2.625 then no lender fee and just closing cost.

Similar were the rates with another lender.
Can you share lender for both?
gerbilunit
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Re: Refinance Mega Thread

Post by gerbilunit »

pianos101 wrote: Fri Jul 17, 2020 6:19 pm
gerbilunit wrote: Fri Jul 17, 2020 6:18 pm Still learning and reading a lot on this mega thread and there's a ton of good information. I wanted to ask the pro's here if this is considered typical.

LenderFi came back with 2.75 30 yr. The lender credit shows $1400 which covers everything except for letter F which is the pre-paids. Specifically the Prepaid interest amount. When everyone talks about 0 fee, is it considered not a great deal if the lender fee doesn't cover the prepaid interest amount? If I was to not have that balance, my lender credit would be $95 in my favor.

Sorry if this is a noob question, just trying to digest all of this information as quickly as possible and see if this is a good deal.
Considering you have to pay interest, taxes, and insurance no matter what, yes a "no cost" refi is where the only thing you have to bring to table is taxes, insurance, and interest.

For example, I just locked with LoanDepot and they are giving me a $4500 credit, which turns into a net $1800 lender credit that will be applied to my interest/insurance/property taxes at closing.
Ah makes sense. Thank you. So it looks like that my lender credit would turn net $95 towards my interest. Seems like a good rate and good deal to me.
gerbilunit
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Re: Refinance Mega Thread

Post by gerbilunit »

At what point am I no longer able to rate shop? Will signing initial disclosures lock me in with one lender or can I continue to leverage other offers if they come in from another lender? My rate is getting locked and I intend on proceeding with these folks but just want to know when I would need to forego entertaining other offers?
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BrandonBogle
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Re: Refinance Mega Thread

Post by BrandonBogle »

gerbilunit wrote: Fri Jul 17, 2020 7:06 pm At what point am I no longer able to rate shop? Will signing initial disclosures lock me in with one lender or can I continue to leverage other offers if they come in from another lender? My rate is getting locked and I intend on proceeding with these folks but just want to know when I would need to forego entertaining other offers?
Well, you can rate shop the entire time. You never need to stop. If you want to leverage other offers, you have until the closing table.
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Cobra Commander
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Re: Refinance Mega Thread

Post by Cobra Commander »

exarkun wrote: Fri Jul 17, 2020 12:36 pm Anyone else refinance with a VA loan streamline (irrrl)?
How much credit did the lender's give you to offset the VA funding fee and other A+B+C+E costs and how much closing did you pay out of pocket vs rolling into the principle? Are they generally less flexible on offsetting the VA fee?
For me, I found that I got much better rates on conforming loans than VA IRRLs. That wasnt the case years ago when I bought but maybe now that my LTV is better and I'm below the conforming limit that changes things.
exarkun
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Re: Refinance Mega Thread

Post by exarkun »

ChiKid24 wrote: Wed Jul 15, 2020 11:40 am
This refers to the amount of total costs less lender credits that they are rolling into your new loan. Above that line there should be a section that says "Estimated Cash to Close" and it will have a checked box for either "From" or "To Borrower". My guess is the one showing $0 has you bringing cash to close in this section, and the one with $1,595 either has you bringing less cash to close or has cash going "To Borrower" at close.

Simple way to compare the loans is as follows:
1) Are the interest rates the same? If so, move to step 2
2) Add up A,B,C and E and subtract the Lender Credit listed in Section J
3) The loan with the lowest number in step 2 wins!

The other items are really just noise. Section F is Prepaids. These are things that you will be paying under all scenarios, even if you don't go through with the refinance. The lenders might show different amounts, but once the loan closes and is funded the actual value will be the same. Section G is Escrow for things like Homeowner's Insurance, Mortgage Insurance, Property Taxes. Again, these are things you will be paying under all scenarios, it's just a matter of timing and if they are included in your monthly mortgage payment or if you do them on your own.
This is pretty helpful. If step one is different rates, is there an easy way to compare? Use APR?
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LadyGeek
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Re: Refinance Mega Thread

Post by LadyGeek »

Not APR. The Time Value of Money equations to the rescue. See the wiki: Comparing investments

The investment with the lowest Present Value wins.

Give it a shot. If you get stuck, show us what you did and ask for help.

If you have no idea what to do, that's OK. Just post the info and we'll help you work through it.
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dave8228
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Re: Refinance Mega Thread

Post by dave8228 »

I have a quick ACH question for you all. I closed on a refi this morning, and initiated an ACH transfer via the title company's website this afternoon. I went and looked at all the paperwork this evening and realized that I incorrectly selected savings account vs checking account during the ACH. If the routing and account number is correct, does anyone know if the account type even matters? I plan on calling the title company on Monday, but figured I'd ask you all in case anyone knows.

Thanks!
Last edited by dave8228 on Sat Jul 18, 2020 6:18 am, edited 3 times in total.
mtwhmemn
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Re: Refinance Mega Thread

Post by mtwhmemn »

mtwhmemn wrote: Fri Jul 17, 2020 1:38 pm
homerjsimpson wrote: Fri Jul 17, 2020 1:17 pm
mtwhmemn wrote: Fri Jul 17, 2020 5:09 am
homerjsimpson wrote: Thu Jul 16, 2020 9:39 pm Current Loan: 197k, 3.875%, 25 years left
LTV: 45%
credit: 800
primary residence

Better:
15 yr, A+B+C - credit = $200, 3.5% (not a typo)
15 yr, A+B+C = $3,428, 2.625%

Am I doing something wrong? I see people getting rates on 30yr loans that are 0.75% better! Maybe the lenders are so swamped that they’re offering “go away” quotes.
You and I are in kind of a similar situation. I posted this earlier and received no feedback. "Is this a fair deal to refi my 188K loan on my 270K North Carolina home currently on a 30 at 3.875?

Better.com is offering me the following today:

A: $655
B: $614 ($550 of this is Appraisal fee which will be refunded)
C: $1386

A+B+C=2655 minus $550 for appraisal minus $2500 AMEX credit = $395 goes in my pocket

New loan is 20 year @ 3% (I gather from this thread my rate is a bit higher because my loan is well under $200K???)

Thanks."

So, we both are looking to refi a balance of less than $200K which I've gathered from this thread doesn't get you the lowest rate. I'm in North Carolina, don't know where you are but your ZIP code has something to do with it. I'm going to go with my deal because it isn't going to cost me anything and I'll get a better rate & a shorter term. I guess you look at the AMEX credit as a "Lender Credit" - I mean what else can it be called? In my case they say they are going to credit me for the appraisal, but I doubt they are even going to do one, whatever.

For those of you looking to get the AMEX credit my rep told me you had to lock by end of next week. I didn't have an AMEX but applied and was approved instantly and even got the card number and even got it to work on my iPhone wallet all within minutes.

If anyone can tell me why I SHOULDN'T do my deal please do I would really like some feedback.
I'm also in NC, though I can't imagine why that would be a problem. However, you're probably right on the low refi balance. Though I was initially against it, I might get a quote with the closing costs added to the loan balance, just to push me over 200k.

What's also interesting is that I'm seeing little, if any difference between terms. Just got the following quotes from Lenderfi:

15 year no-cost: 3.125%
20 year no-cost: 3.5%
30 year no-cost: 3.25%
I just locked with Better.com with the deal outlined above. Fingers crossed. Best of luck to you.
At what point in the Better.com refi process do they ask you for your AMEX account number (if you are getting the $2500 AMEX credit deal) ? Thanks.
DrGrnTum
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Re: Refinance Mega Thread

Post by DrGrnTum »

by mtwhmemn
At what point in the Better.com refi process do they ask you for your AMEX account number (if you are getting the $2500 AMEX credit deal) ? Thanks.
When I got my final closing statement, right before I closed I inquired to Better about the $2,500 credit.
They asked me to answer a few questions that they sent in an email to confirm that I was eligible.
They then sent me a task prompt in my account portal.
This task prompted me to input my information about my Amex CC.

Others on this thread have reported that after they closed they got a confirmation email from Better that they had processed the Amex credit. I image this means that Better sent the request to Amex.
Somewhere there is some language that says It could take up to 8-12 weeks to get the credit.

I have been following this thread for a while and I don't recall anyone reporting that they have indeed got the credit so I can not tell you when you may actually get the credit.
dave8228
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Re: Refinance Mega Thread

Post by dave8228 »

dave8228 wrote: Fri Jul 17, 2020 8:37 pm I have a quick ACH question for you all. I closed on a refi this morning, and initiated an ACH transfer via the title company's website this afternoon. I went and looked at all the paperwork this evening and realized that I incorrectly selected savings account vs checking account during the ACH. If the routing and account number is correct, does anyone know if the account type even matters? I plan on calling the title company on Monday, but figured I'd ask you all in case anyone knows.

Thanks!

Update: I just called the title company and they said the account type doesn't matter. Phew!
kski74
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Re: Refinance Mega Thread

Post by kski74 »

For those unable to get Better.com in their state (like us in MA), Rocket Mortgages had the same offer with AmEx. We tried to have them match the Lenderfi offer and they told us (before even getting to matching the rate, which they couldn't do) that they are no longer doing the AmEx incentive (which also means appraisal cannot be waived.). So if you are in a non-Better.com state, it seems like options for the $2,500 credit from AmEx are down to none right now. (We missed on it with Rocket Mortgage the last time as for a period of 3 weeks starting in mid-April, Rocket stopped doing locks and when we they were ready to lock again, their rate was no longer close to a match with Northpointe. Their heavy-handed sales tactics along the way were atrocious.)

So we're moving onto our second refinance this year with Lenderfi at 2.75% with zero closing costs on a 30 year. Down from 3.125%. Overall, we've come down 1.625% this year! :shock: :beer
exarkun
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Re: Refinance Mega Thread

Post by exarkun »

LadyGeek wrote: Fri Jul 17, 2020 8:37 pm Not APR. The Time Value of Money equations to the rescue. See the wiki: Comparing investments

The investment with the lowest Present Value wins.

Give it a shot. If you get stuck, show us what you did and ask for help.

If you have no idea what to do, that's OK. Just post the info and we'll help you work through it.
Oops, that was an unfortunate typo, I meant to ask if I should then compare APY. I'll take a look at that wiki page and see if I can figure it out. Thank you.
bestisfree
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Re: Refinance Mega Thread

Post by bestisfree »

For those who went with Better Mortgage and used their in-house title company (Title365), did you need to use a wire transfer for the funds or they provide a way to do ACH?
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LadyGeek
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Re: Refinance Mega Thread

Post by LadyGeek »

exarkun wrote: Sat Jul 18, 2020 11:11 am
LadyGeek wrote: Fri Jul 17, 2020 8:37 pm Not APR. The Time Value of Money equations to the rescue. See the wiki: Comparing investments

The investment with the lowest Present Value wins.

Give it a shot. If you get stuck, show us what you did and ask for help.

If you have no idea what to do, that's OK. Just post the info and we'll help you work through it.
Oops, that was an unfortunate typo, I meant to ask if I should then compare APY. I'll take a look at that wiki page and see if I can figure it out. Thank you.
Neither APR nor APY would work as the only item to compare.

Just in case, that wiki page also explains the difference between APR and APY. Hint: They are the same thing expressed over a different period of time.

Take your time. If you don't have a spreadsheet program, I recommend LibreOffice Calc. It's free and open source.
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BrandonBogle
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Re: Refinance Mega Thread

Post by BrandonBogle »

DrGrnTum wrote: Sat Jul 18, 2020 9:20 am I have been following this thread for a while and I don't recall anyone reporting that they have indeed got the credit so I can not tell you when you may actually get the credit.
I woke up at 8 am Eastern today, no credit when I looked at Amex. After my morning routine at 10:30 am Eastern, no credit. Just got back from the grocery store at 12:45 pm and my Amex credit is there! Closed 5/13 and credit showed up 7/18 with a posting date of 7/13.

Now I will schedule closing on the next refi and await another Amex credit in a few weeks!
mtwhmemn
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Re: Refinance Mega Thread

Post by mtwhmemn »

DrGrnTum wrote: Sat Jul 18, 2020 9:20 am
by mtwhmemn
At what point in the Better.com refi process do they ask you for your AMEX account number (if you are getting the $2500 AMEX credit deal) ? Thanks.
When I got my final closing statement, right before I closed I inquired to Better about the $2,500 credit.
They asked me to answer a few questions that they sent in an email to confirm that I was eligible.
They then sent me a task prompt in my account portal.
This task prompted me to input my information about my Amex CC.

Others on this thread have reported that after they closed they got a confirmation email from Better that they had processed the Amex credit. I image this means that Better sent the request to Amex.
Somewhere there is some language that says It could take up to 8-12 weeks to get the credit.

I have been following this thread for a while and I don't recall anyone reporting that they have indeed got the credit so I can not tell you when you may actually get the credit.
Thanks!
leviathan
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Re: Refinance Mega Thread

Post by leviathan »

BrandonBogle wrote: Sat Jul 18, 2020 11:51 am
DrGrnTum wrote: Sat Jul 18, 2020 9:20 am I have been following this thread for a while and I don't recall anyone reporting that they have indeed got the credit so I can not tell you when you may actually get the credit.
I woke up at 8 am Eastern today, no credit when I looked at Amex. After my morning routine at 10:30 am Eastern, no credit. Just got back from the grocery store at 12:45 pm and my Amex credit is there! Closed 5/13 and credit showed up 7/18 with a posting date of 7/13.

Now I will schedule closing on the next refi and await another Amex credit in a few weeks!
Thanks for the update. You seem to be the 1st one to report the receipt of the credit in this thread.
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anon_investor
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Re: Refinance Mega Thread

Post by anon_investor »

BrandonBogle wrote: Sat Jul 18, 2020 11:51 am
DrGrnTum wrote: Sat Jul 18, 2020 9:20 am I have been following this thread for a while and I don't recall anyone reporting that they have indeed got the credit so I can not tell you when you may actually get the credit.
I woke up at 8 am Eastern today, no credit when I looked at Amex. After my morning routine at 10:30 am Eastern, no credit. Just got back from the grocery store at 12:45 pm and my Amex credit is there! Closed 5/13 and credit showed up 7/18 with a posting date of 7/13.

Now I will schedule closing on the next refi and await another Amex credit in a few weeks!
Too bad you can't close fast enough to get the credit a 3rd time!!!
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BrandonBogle
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Re: Refinance Mega Thread

Post by BrandonBogle »

anon_investor wrote: Sat Jul 18, 2020 12:35 pm
BrandonBogle wrote: Sat Jul 18, 2020 11:51 am
DrGrnTum wrote: Sat Jul 18, 2020 9:20 am I have been following this thread for a while and I don't recall anyone reporting that they have indeed got the credit so I can not tell you when you may actually get the credit.
I woke up at 8 am Eastern today, no credit when I looked at Amex. After my morning routine at 10:30 am Eastern, no credit. Just got back from the grocery store at 12:45 pm and my Amex credit is there! Closed 5/13 and credit showed up 7/18 with a posting date of 7/13.

Now I will schedule closing on the next refi and await another Amex credit in a few weeks!
Too bad you can't close fast enough to get the credit a 3rd time!!!
I have a calendar entry to open up another Better application on Thursday using the promo, just in case. It may not happen, but not hard to spend the little bit of effort to try!
need403bhelp
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Re: Refinance Mega Thread

Post by need403bhelp »

BrandonBogle wrote: Sat Jul 18, 2020 12:41 pm
anon_investor wrote: Sat Jul 18, 2020 12:35 pm
BrandonBogle wrote: Sat Jul 18, 2020 11:51 am
DrGrnTum wrote: Sat Jul 18, 2020 9:20 am I have been following this thread for a while and I don't recall anyone reporting that they have indeed got the credit so I can not tell you when you may actually get the credit.
I woke up at 8 am Eastern today, no credit when I looked at Amex. After my morning routine at 10:30 am Eastern, no credit. Just got back from the grocery store at 12:45 pm and my Amex credit is there! Closed 5/13 and credit showed up 7/18 with a posting date of 7/13.

Now I will schedule closing on the next refi and await another Amex credit in a few weeks!
Too bad you can't close fast enough to get the credit a 3rd time!!!
I have a calendar entry to open up another Better application on Thursday using the promo, just in case. It may not happen, but not hard to spend the little bit of effort to try!
Why Thursday and not Saturday (7/25)?
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Re: Refinance Mega Thread

Post by Gadget »

bestisfree wrote: Sat Jul 18, 2020 11:15 am For those who went with Better Mortgage and used their in-house title company (Title365), did you need to use a wire transfer for the funds or they provide a way to do ACH?
I had to either wire transfer the funds or have a cashier's check at closing. Wire transfers are free with Fidelity CMA. If the wire transfer would cost you, I'd just get a cashier's check if it's free with your local bank.

They wouldn't do ACH.
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BrandonBogle
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Re: Refinance Mega Thread

Post by BrandonBogle »

need403bhelp wrote: Sat Jul 18, 2020 1:11 pm
BrandonBogle wrote: Sat Jul 18, 2020 12:41 pm I have a calendar entry to open up another Better application on Thursday using the promo, just in case. It may not happen, but not hard to spend the little bit of effort to try!
Why Thursday and not Saturday (7/25)?
B/c I remembered the days wrong. I have a calendar entry for 7/24, and thought that 7/25 was Friday :) My plan is to open it a day before the deadline, so Friday.
Familyman2012
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Re: Refinance Mega Thread

Post by Familyman2012 »

BrandonBogle wrote: Sat Jul 18, 2020 2:53 pm
need403bhelp wrote: Sat Jul 18, 2020 1:11 pm
BrandonBogle wrote: Sat Jul 18, 2020 12:41 pm I have a calendar entry to open up another Better application on Thursday using the promo, just in case. It may not happen, but not hard to spend the little bit of effort to try!
Why Thursday and not Saturday (7/25)?
B/c I remembered the days wrong. I have a calendar entry for 7/24, and thought that 7/25 was Friday :) My plan is to open it a day before the deadline, so Friday.
I didn’t even know you can get the promo twice. Did you confirm?

Monday is supposed to be my disbursement date. I want to try to do a refi again before 7/25. But afraid it’s going to mess up my Amex promo. I’m not a gambling man.
need403bhelp
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Re: Refinance Mega Thread

Post by need403bhelp »

Familyman2012 wrote: Sat Jul 18, 2020 3:46 pm
BrandonBogle wrote: Sat Jul 18, 2020 2:53 pm
need403bhelp wrote: Sat Jul 18, 2020 1:11 pm
BrandonBogle wrote: Sat Jul 18, 2020 12:41 pm I have a calendar entry to open up another Better application on Thursday using the promo, just in case. It may not happen, but not hard to spend the little bit of effort to try!
Why Thursday and not Saturday (7/25)?
B/c I remembered the days wrong. I have a calendar entry for 7/24, and thought that 7/25 was Friday :) My plan is to open it a day before the deadline, so Friday.
I didn’t even know you can get the promo twice. Did you confirm?

Monday is supposed to be my disbursement date. I want to try to do a refi again before 7/25. But afraid it’s going to mess up my Amex promo. I’m not a gambling man.
I confirmed I can get the promo twice although I received the offer on two different cards.

My credit posted by the way some time ago, closed in February.
Familyman2012
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Re: Refinance Mega Thread

Post by Familyman2012 »

need403bhelp wrote: Sat Jul 18, 2020 6:57 pm
Familyman2012 wrote: Sat Jul 18, 2020 3:46 pm
BrandonBogle wrote: Sat Jul 18, 2020 2:53 pm
need403bhelp wrote: Sat Jul 18, 2020 1:11 pm
BrandonBogle wrote: Sat Jul 18, 2020 12:41 pm I have a calendar entry to open up another Better application on Thursday using the promo, just in case. It may not happen, but not hard to spend the little bit of effort to try!
Why Thursday and not Saturday (7/25)?
B/c I remembered the days wrong. I have a calendar entry for 7/24, and thought that 7/25 was Friday :) My plan is to open it a day before the deadline, so Friday.
I didn’t even know you can get the promo twice. Did you confirm?

Monday is supposed to be my disbursement date. I want to try to do a refi again before 7/25. But afraid it’s going to mess up my Amex promo. I’m not a gambling man.
I confirmed I can get the promo twice although I received the offer on two different cards.

My credit posted by the way some time ago, closed in February.
Thanks for your reply. The second time around, Did you present a LE to better to match? Or did you contact your loan officer for your 1st refi to give an offer?
NDS
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Re: Refinance Mega Thread

Post by NDS »

General question - is there a good online / XLS-based calculator you'd recommend to compare existing mortgage to a new mortgage offer to see if it makes sense? My existing mortgage is 30y fixed- 156k @ 3.625%, starting Dec 2016, 145k left. I don't currently know what my closing costs on that mortgage were, and/or whether the original mortgage closing costs should figure into the total answer of whether new offer is better. New offer is 30year fixed @ 2.875% w/ 2k in closing costs.
Cbtexan04
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Re: Refinance Mega Thread

Post by Cbtexan04 »

Hey everyone! Long time listener, first time caller.

I have a multiplex investment property that I own free and clear. I’m looking to do a cash out on it, and I’m shopping around for rates. We’re looking at 175k cash out on 250k. Unfortunately rates on this home are fairly high and/or require buying a ton of points to buy it down.

For instance, LD quoted me 3.625% with $7700 worth of points. The total closing costs would be a whopping 12k!!

Why’s my best bet here? Do I try to ask different lenders for low (or no) point options so I can compare easier? Can I simply ask for lender credits, or do I need to bring a LE from a competitor (in which case don’t I have a chicken and egg issue if all my quotes are high)?

Just really lost here and not sure my next move. I can’t cash out refi on my primary as I don’t have that much equity in it. I’m almost thinking I’m better off with a HELOC from penfed in the first position on the investment property. That’s prime +1.5% (but can also do it as a fixed rate option) with only paying appraisal + recording fees.
exarkun
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Re: Refinance Mega Thread

Post by exarkun »

LadyGeek wrote: Sat Jul 18, 2020 11:18 am Neither APR nor APY would work as the only item to compare.

Just in case, that wiki page also explains the difference between APR and APY. Hint: They are the same thing expressed over a different period of time.

Take your time. If you don't have a spreadsheet program, I recommend LibreOffice Calc. It's free and open source.
Based on the wiki page you linked, I calculated the present value of the payments over the years I would make to the lender. This ended up just being the loan amount of the refinance, so I'm not sure I did the right thing here...

I used jimb_fromATL's post to help compare the various refinance options and break even month, which was interesting.
homerjsimpson
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Re: Refinance Mega Thread

Post by homerjsimpson »

mtwhmemn wrote: Fri Jul 17, 2020 1:38 pm
homerjsimpson wrote: Fri Jul 17, 2020 1:17 pm
mtwhmemn wrote: Fri Jul 17, 2020 5:09 am
homerjsimpson wrote: Thu Jul 16, 2020 9:39 pm Current Loan: 197k, 3.875%, 25 years left
LTV: 45%
credit: 800
primary residence

Better:
15 yr, A+B+C - credit = $200, 3.5% (not a typo)
15 yr, A+B+C = $3,428, 2.625%

Am I doing something wrong? I see people getting rates on 30yr loans that are 0.75% better! Maybe the lenders are so swamped that they’re offering “go away” quotes.
You and I are in kind of a similar situation. I posted this earlier and received no feedback. "Is this a fair deal to refi my 188K loan on my 270K North Carolina home currently on a 30 at 3.875?

Better.com is offering me the following today:

A: $655
B: $614 ($550 of this is Appraisal fee which will be refunded)
C: $1386

A+B+C=2655 minus $550 for appraisal minus $2500 AMEX credit = $395 goes in my pocket

New loan is 20 year @ 3% (I gather from this thread my rate is a bit higher because my loan is well under $200K???)

Thanks."

So, we both are looking to refi a balance of less than $200K which I've gathered from this thread doesn't get you the lowest rate. I'm in North Carolina, don't know where you are but your ZIP code has something to do with it. I'm going to go with my deal because it isn't going to cost me anything and I'll get a better rate & a shorter term. I guess you look at the AMEX credit as a "Lender Credit" - I mean what else can it be called? In my case they say they are going to credit me for the appraisal, but I doubt they are even going to do one, whatever.

For those of you looking to get the AMEX credit my rep told me you had to lock by end of next week. I didn't have an AMEX but applied and was approved instantly and even got the card number and even got it to work on my iPhone wallet all within minutes.

If anyone can tell me why I SHOULDN'T do my deal please do I would really like some feedback.
I'm also in NC, though I can't imagine why that would be a problem. However, you're probably right on the low refi balance. Though I was initially against it, I might get a quote with the closing costs added to the loan balance, just to push me over 200k.

What's also interesting is that I'm seeing little, if any difference between terms. Just got the following quotes from Lenderfi:

15 year no-cost: 3.125%
20 year no-cost: 3.5%
30 year no-cost: 3.25%
I just locked with Better.com with the deal outlined above. Fingers crossed. Best of luck to you.
Thanks! I received more quotes from other lenders, which were similarly high. However after actually speaking speaking with Lenderfi, I received a better deal and ended up locking at 2.625% for a 15 yr with $500 in loan costs. Hopefully I don't regret the 15 yr, but I'm excited about nearly 2/3 of my payment going to principal.

For others wondering about this process, I found that you have to be a little pushy to get a quote for a true no-cost refi. Most lenders will automatically add points to quote a low rate, and then roll the the costs into the loan balance so you don't need to bring cash to close. While I had a few issues with Lenderfi, at least they understood immediately what I was asking for.
need403bhelp
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Re: Refinance Mega Thread

Post by need403bhelp »

Familyman2012 wrote: Sat Jul 18, 2020 7:03 pm
need403bhelp wrote: Sat Jul 18, 2020 6:57 pm
Familyman2012 wrote: Sat Jul 18, 2020 3:46 pm
BrandonBogle wrote: Sat Jul 18, 2020 2:53 pm
need403bhelp wrote: Sat Jul 18, 2020 1:11 pm

Why Thursday and not Saturday (7/25)?
B/c I remembered the days wrong. I have a calendar entry for 7/24, and thought that 7/25 was Friday :) My plan is to open it a day before the deadline, so Friday.
I didn’t even know you can get the promo twice. Did you confirm?

Monday is supposed to be my disbursement date. I want to try to do a refi again before 7/25. But afraid it’s going to mess up my Amex promo. I’m not a gambling man.
I confirmed I can get the promo twice although I received the offer on two different cards.

My credit posted by the way some time ago, closed in February.
Thanks for your reply. The second time around, Did you present a LE to better to match? Or did you contact your loan officer for your 1st refi to give an offer?
Sorry, to clarify, I’ve only gotten the credit once but confirmed it can be done twice via concierge@better.com.

I plan to apply Friday same as BrandonBogle. I’ve been waiting to do it second time around as rates keep falling so I’ve basically been waiting as long as possible (prob won’t start doing more work until another two weeks after applying as you have 30 days to lock after the “soft pull” application).

I do plan to present other LEs and was confirmed that they would try to match despite Better Price Guarantee not applying within 6 months of funding of prior loan.

Hope that helps!
exarkun
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Re: Refinance Mega Thread

Post by exarkun »

exarkun wrote: Sat Jul 18, 2020 8:39 pm
LadyGeek wrote: Sat Jul 18, 2020 11:18 am Neither APR nor APY would work as the only item to compare.

Just in case, that wiki page also explains the difference between APR and APY. Hint: They are the same thing expressed over a different period of time.

Take your time. If you don't have a spreadsheet program, I recommend LibreOffice Calc. It's free and open source.
Based on the wiki page you linked, I calculated the present value of the payments over the years I would make to the lender. This ended up just being the loan amount of the refinance, so I'm not sure I did the right thing here...

I used jimb_fromATL's post to help compare the various refinance options and break even month, which was interesting.
OK, I think I found a good article to help describe what I should do.
I calculated the remaining balance on my new refinance options when the original mortgage would be paid off in 27 years then calculated the present value of that balance.
Next, I calculated the net present value of the difference in payments over that same period.
Subtracting the 27 years balance present value from the net present value of the difference in payments gives the net present value of the refinance options.

Does this make sense?
Last edited by exarkun on Sun Jul 19, 2020 3:21 pm, edited 1 time in total.
omega
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Re: Refinance Mega Thread

Post by omega »

Thanks all for the wealth of information here.

I finally decided to do the refinance today.

Current scenario:

Primary residence in NJ, 400K remaining of 630K home, 3.625% rate for 30 years.

I applied to better.com and got the following offer

2.5% rate for 15 years with 2980 (points) and 2926 (third party fees), appraisal fee waived and 2500 Amex credit.

Is it a good offer?

I am also going to check Lenderfi and LoanDepot. Any other places I should check?

Thank you!
User avatar
anon_investor
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Re: Refinance Mega Thread

Post by anon_investor »

omega wrote: Sun Jul 19, 2020 3:17 pm Thanks all for the wealth of information here.

I finally decided to do the refinance today.

Current scenario:

Primary residence in NJ, 400K remaining of 630K home, 3.625% rate for 30 years.

I applied to better.com and got the following offer

2.5% rate for 15 years with 2980 (points) and 2926 (third party fees), appraisal fee waived and 2500 Amex credit.

Is it a good offer?

I am also going to check Lenderfi and LoanDepot. Any other places I should check?

Thank you!
What kind of rate are they offering for 0 pts and enough lender credits (excluding the $2.5k Amex credit) completely offset third party fees?
omega
Posts: 101
Joined: Wed Feb 01, 2017 9:38 pm

Re: Refinance Mega Thread

Post by omega »

anon_investor wrote: Sun Jul 19, 2020 3:19 pm
omega wrote: Sun Jul 19, 2020 3:17 pm Thanks all for the wealth of information here.

I finally decided to do the refinance today.

Current scenario:

Primary residence in NJ, 400K remaining of 630K home, 3.625% rate for 30 years.

I applied to better.com and got the following offer

2.5% rate for 15 years with 2980 (points) and 2926 (third party fees), appraisal fee waived and 2500 Amex credit.

Is it a good offer?

I am also going to check Lenderfi and LoanDepot. Any other places I should check?

Thank you!
What kind of rate are they offering for 0 pts and enough lender credits (excluding the $2.5k Amex credit) completely offset third party fees?
2.9% I believe
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LadyGeek
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Re: Refinance Mega Thread

Post by LadyGeek »

exarkun wrote: Sun Jul 19, 2020 3:10 pm
exarkun wrote: Sat Jul 18, 2020 8:39 pm
LadyGeek wrote: Sat Jul 18, 2020 11:18 am Neither APR nor APY would work as the only item to compare.

Just in case, that wiki page also explains the difference between APR and APY. Hint: They are the same thing expressed over a different period of time.

Take your time. If you don't have a spreadsheet program, I recommend LibreOffice Calc. It's free and open source.
Based on the wiki page you linked, I calculated the present value of the payments over the years I would make to the lender. This ended up just being the loan amount of the refinance, so I'm not sure I did the right thing here...

I used jimb_fromATL's post to help compare the various refinance options and break even month, which was interesting.
OK, I think I found a good article to help describe what I should do.
I calculated the remaining balance on my new refinance options when the original mortgage would be paid off in 27 years then calculated the present value of that balance.
Next, I calculated the net present value of the difference in payments over that same period.
Subtracting the 27 years balance present value from the net present value of the difference in payments gives the net present value of the refinance options.

Does this make sense?
I can't say for sure, but if you've followed jimb_fromATL's post it was most likely done right.

Perhaps someone else can chime in to confirm exarkun's approach.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
Soares1234
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Re: Refinance Mega Thread

Post by Soares1234 »

Cbtexan04 wrote: Sat Jul 18, 2020 8:31 pm Hey everyone! Long time listener, first time caller.

I have a multiplex investment property that I own free and clear. I’m looking to do a cash out on it, and I’m shopping around for rates. We’re looking at 175k cash out on 250k. Unfortunately rates on this home are fairly high and/or require buying a ton of points to buy it down.

For instance, LD quoted me 3.625% with $7700 worth of points. The total closing costs would be a whopping 12k!!

Why’s my best bet here? Do I try to ask different lenders for low (or no) point options so I can compare easier? Can I simply ask for lender credits, or do I need to bring a LE from a competitor (in which case don’t I have a chicken and egg issue if all my quotes are high)?

Just really lost here and not sure my next move. I can’t cash out refi on my primary as I don’t have that much equity in it. I’m almost thinking I’m better off with a HELOC from penfed in the first position on the investment property. That’s prime +1.5% (but can also do it as a fixed rate option) with only paying appraisal + recording fees.
Search Investment in the search box at the top. Try rental
Too. This will get to answers.
Mongoose42
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Re: Refinance Mega Thread

Post by Mongoose42 »

We just got appraisal back through Better, and it’s $50K below the purchase price 8 months ago. I think it’s too low based on sales prices that are still strong (if not higher) in my area post COVID, but does this matter?

We are still at 55% LTV, so I think it’s not a big deal, and maybe we can use this to try and lower property taxes, but want to make sure I’m not missing anything.
Soares1234
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Re: Refinance Mega Thread

Post by Soares1234 »

Has anyone transferred the appraisal? How did
you go about doing it with the
Lender?

There should be a different process with appraisal. I paid for it. I should get access to it and send it to whoever.
thrillhou
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Re: Refinance Mega Thread

Post by thrillhou »

NDS wrote: Sat Jul 18, 2020 8:04 pm General question - is there a good online / XLS-based calculator you'd recommend to compare existing mortgage to a new mortgage offer to see if it makes sense? My existing mortgage is 30y fixed- 156k @ 3.625%, starting Dec 2016, 145k left. I don't currently know what my closing costs on that mortgage were, and/or whether the original mortgage closing costs should figure into the total answer of whether new offer is better. New offer is 30year fixed @ 2.875% w/ 2k in closing costs.
I made my own spreadsheet for what seems to be what you're asking for. To me, I don't want to refinance and end up paying more in interest than my current loan will be paying from today until it's paid-off. So, in your case it's approx 318 months left * ~$711 / month = $226,098. A 360 mo loan at 2.875% for $147k has a total cost of ~$219.6k. So, only from this calculation, you'll save about $7k. (I think Zillow also has a refinance calculator like this;
https://www.zillow.com/mortgage-calcula ... alculator/

I created my own spreadsheet because the online calculators didn't easily allow me to add extra money for the monthly payments (thereby enabling the total cost to equalize.)
thrillhou
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Re: Refinance Mega Thread

Post by thrillhou »

I have a general question about refinancing and the effect on building equity. Is there a forum consensus on the importance or value of equity or otherwise building equity in your home?

I ask, because it seems like at some point refinancing may not be beneficial since the finally payment keeps getting moved further in the future.
thrillhou
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Re: Refinance Mega Thread

Post by thrillhou »

What differences in loan offers might there be if not all personal assets' statements are provided (or told) to the LO? Put another way, can anyone comment on how assets -- independent of income -- change the refi offer?
FiscallyResponsible
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Re: Refinance Mega Thread

Post by FiscallyResponsible »

Moving right along with my refi from Better.com. 2.625% for a 30 year fixed on no cost refi. I first inquired about 12 days ago and we have approval now and are moving towards coordinating on closing. I have been pretty good about uploading everything needed same day things were requested.

My loan amount is ~$410k on a $700k home. My lender credit drops from about $2300 to $1000 if I roll in my prepaids into the loan. Paying an extra $1300 to increase my loan about $6-7k seems ridiculous. Am I wrong? I don't remember seeing this in previous refis with other lenders. I'm not going to complain though, seeing as I am getting a pretty great rate + AMEX credit.

Thanks!
Soares1234
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Re: Refinance Mega Thread

Post by Soares1234 »

FiscallyResponsible wrote: Mon Jul 20, 2020 6:22 am Moving right along with my refi from Better.com. 2.625% for a 30 year fixed on no cost refi. I first inquired about 12 days ago and we have approval now and are moving towards coordinating on closing. I have been pretty good about uploading everything needed same day things were requested.

My loan amount is ~$410k on a $700k home. My lender credit drops from about $2300 to $1000 if I roll in my prepaids into the loan. Paying an extra $1300 to increase my loan about $6-7k seems ridiculous. Am I wrong? I don't remember seeing this in previous refis with other lenders. I'm not going to complain though, seeing as I am getting a pretty great rate + AMEX credit.

Thanks!

You would be paying those prepaids anyways right. Except now you are rolling them into the loan. Taking a month or so off from the initial mortgage payments but paying interest on that amount for the term of the loan.
FiscallyResponsible
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Re: Refinance Mega Thread

Post by FiscallyResponsible »

Soares1234 wrote: Mon Jul 20, 2020 6:48 am
FiscallyResponsible wrote: Mon Jul 20, 2020 6:22 am Moving right along with my refi from Better.com. 2.625% for a 30 year fixed on no cost refi. I first inquired about 12 days ago and we have approval now and are moving towards coordinating on closing. I have been pretty good about uploading everything needed same day things were requested.

My loan amount is ~$410k on a $700k home. My lender credit drops from about $2300 to $1000 if I roll in my prepaids into the loan. Paying an extra $1300 to increase my loan about $6-7k seems ridiculous. Am I wrong? I don't remember seeing this in previous refis with other lenders. I'm not going to complain though, seeing as I am getting a pretty great rate + AMEX credit.

Thanks!

You would be paying those prepaids anyways right. Except now you are rolling them into the loan. Taking a month or so off from the initial mortgage payments but paying interest on that amount for the term of the loan.
I expected to see my loan amount go up reflecting that I would be paying for it over the course of the loan. I didn't think the lender credit offsetting non-prepaid loan costs would go down. I am getting a double whammy of sorts.
Outer Marker
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Re: Refinance Mega Thread

Post by Outer Marker »

omega wrote: Sun Jul 19, 2020 3:17 pm Thanks all for the wealth of information here.

I finally decided to do the refinance today.

Current scenario:

Primary residence in NJ, 400K remaining of 630K home, 3.625% rate for 30 years.

I applied to better.com and got the following offer

2.5% rate for 15 years with 2980 (points) and 2926 (third party fees), appraisal fee waived and 2500 Amex credit.

Is it a good offer?

I am also going to check Lenderfi and LoanDepot. Any other places I should check?

Thank you!
That does not sound particularly good in today's market. Check with Amerisave. Working on closing a 15 year at 2.625, 0 points, $ -5,900 lender credit at settlement.
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