Refinance Mega Thread

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FS51
Posts: 49
Joined: Thu Sep 11, 2014 11:15 am

Re: Refinance Mega Thread

Post by FS51 »

Received LE from lender

3.00% 30yr Fixed
A - 0
B - 201
C - 1070
D - 1271

E - 205
F - 987
G - 1849

I - 3041
J - 2836 (D+I - 4312 - 1476 lender credit)

I was looking for a no cost. Am I reading this right? Looking at 3041 in prepaids and escrow and the lender credit wipes out the loan costs? Still 2836 cash to close.
chaalo_aavjo
Posts: 5
Joined: Sat Aug 15, 2020 4:01 pm

Re: Refinance Mega Thread

Post by chaalo_aavjo »

Hello Everyone,

I'm hoping someone can help me understand how to compare two options. So far I've only seen discussions on comparing rate quotes and fees between two lenders but haven't seen much talk about loan amount vs. payoff amount.

In my specific scenario, LF provided an LE for 2.5% 30yr fixed with enough lender credits to bring down closing cost to basically $30 after all fess, prepaids, etc. In the LE, the loan amount is listed just over $409k. This number matches the balance on the current mortgage as shown in the credit report.

I had shared the LE with my current lender and they agreed to match the offer. However, when looking at the "Details of Transaction" section in the application package I received today, following info is listed:

d: The refinance amount is listed at just under $411k. I was told that this is the payoff amount on the current mortgage which takes into account
the interest paid in arrears (i.e. mortgage balance reported on credit report isn't the same as payoff amount).
e: Roughly $300 in prepaid interest.
f: Closing fees of $2000
h: Discount of ($2000)
m: The loan amount is listed as $410k
p: Cash to close $1300

My understanding is that the total cash required at closing (d+e+f+h)-m) is not really a "fee" but a way to effectively take care of the interest calculations. The end result of this is that I get to skip one payment.

Now from what I was told, d and e will obviously change depending on when closing takes place (roughly 3 weeks from now). I will make one payment between now and closing so d will decrease. If let's say we decide on closing exactly 1 month from now, e will remain about the same.

Now here's the question. Am I correct to assume that the LE I received from LF is not taking in to account the payoff cost? Or are they eating the difference between payoff amount (~411k) on current mortgage and the listed loan amount (~409k)? I highly doubt that is the case and assume that the numbers would be "updated" in the final paperwork.

Or the other scenario is that their numbers are correct, in which case I would not be skipping a month of payment as I would be in the scenario given by the current lender?
KeepinItPositive
Posts: 40
Joined: Sat Mar 18, 2017 9:46 am

Re: Refinance Mega Thread

Post by KeepinItPositive »

chaalo_aavjo wrote: Mon Aug 17, 2020 4:41 pm Hello Everyone,

I'm hoping someone can help me understand how to compare two options. So far I've only seen discussions on comparing rate quotes and fees between two lenders but haven't seen much talk about loan amount vs. payoff amount.

In my specific scenario, LF provided an LE for 2.5% 30yr fixed with enough lender credits to bring down closing cost to basically $30 after all fess, prepaids, etc. In the LE, the loan amount is listed just over $409k. This number matches the balance on the current mortgage as shown in the credit report.

I had shared the LE with my current lender and they agreed to match the offer. However, when looking at the "Details of Transaction" section in the application package I received today, following info is listed:

d: The refinance amount is listed at just under $411k. I was told that this is the payoff amount on the current mortgage which takes into account
the interest paid in arrears (i.e. mortgage balance reported on credit report isn't the same as payoff amount).
e: Roughly $300 in prepaid interest.
f: Closing fees of $2000
h: Discount of ($2000)
m: The loan amount is listed as $410k
p: Cash to close $1300

My understanding is that the total cash required at closing (d+e+f+h)-m) is not really a "fee" but a way to effectively take care of the interest calculations. The end result of this is that I get to skip one payment.

Now from what I was told, d and e will obviously change depending on when closing takes place (roughly 3 weeks from now). I will make one payment between now and closing so d will decrease. If let's say we decide on closing exactly 1 month from now, e will remain about the same.

Now here's the question. Am I correct to assume that the LE I received from LF is not taking in to account the payoff cost? Or are they eating the difference between payoff amount (~411k) on current mortgage and the listed loan amount (~409k)? I highly doubt that is the case and assume that the numbers would be "updated" in the final paperwork.

Or the other scenario is that their numbers are correct, in which case I would not be skipping a month of payment as I would be in the scenario given by the current lender?
For me I’m looking at The amount in d to be offset by the lender credit to be true no cost. I would expect the loan amount will get squared away so I wouldn’t look at that a deciding factor.

When did you get your 2.5/30/no cost LE?
User avatar
BrandonBogle
Posts: 3286
Joined: Mon Jan 28, 2013 11:19 pm

Re: Refinance Mega Thread

Post by BrandonBogle »

FS51 wrote: Mon Aug 17, 2020 3:53 pm Received LE from lender

3.00% 30yr Fixed
A - 0
B - 201
C - 1070
D - 1271

E - 205
F - 987
G - 1849

I - 3041
J - 2836 (D+I - 4312 - 1476 lender credit)

I was looking for a no cost. Am I reading this right? Looking at 3041 in prepaids and escrow and the lender credit wipes out the loan costs? Still 2836 cash to close.
Yup. $1,271 + $205 = $1,476, so exactly a no-cost loan. Congrats!
FS51
Posts: 49
Joined: Thu Sep 11, 2014 11:15 am

Re: Refinance Mega Thread

Post by FS51 »

BrandonBogle wrote: Mon Aug 17, 2020 5:22 pm
FS51 wrote: Mon Aug 17, 2020 3:53 pm Received LE from lender

3.00% 30yr Fixed
A - 0
B - 201
C - 1070
D - 1271

E - 205
F - 987
G - 1849

I - 3041
J - 2836 (D+I - 4312 - 1476 lender credit)

I was looking for a no cost. Am I reading this right? Looking at 3041 in prepaids and escrow and the lender credit wipes out the loan costs? Still 2836 cash to close.
Yup. $1,271 + $205 = $1,476, so exactly a no-cost loan. Congrats!
Thank you! Obviously, there's been a jump in rates due to this .5%. I'm waiting on another lender to get back to me but I think it's a solid start that is enough of a drop for me at no cost that I may lock in shortly.
User avatar
Brantley
Posts: 369
Joined: Mon Dec 03, 2012 1:02 am

Re: Refinance Mega Thread

Post by Brantley »

I have a close friend who is looking to get a jumbo in Massachusetts. None of the online options mentioned in this thread or on slick deals seem to be doing jumbos. Any suggestions on where to go? He already has a signed offer so he is looking to move quickly.
~Brantley
InvestDoc
Posts: 33
Joined: Sat Jan 13, 2018 12:54 am

Re: Refinance Mega Thread

Post by InvestDoc »

Rjs wrote: Mon Aug 17, 2020 1:24 pm
jimmyrules712 wrote: Mon Aug 17, 2020 1:00 pm
Rjs wrote: Mon Aug 17, 2020 12:55 pm Hi everyone,
Hoping to get some advice. I am in the process of refinancing my 30 year mortgage with Owning. We are scheduled to close this Thursday and they called about sending a notary home to sign some documents. This is the first time I am refinancing. Is the notary process normal? Any thing we should keep in mind before signing the documents?
Thanks as always for all your help and guidance.
All refinances always have to be signed and notarized in person so this is completely normal. Just make sure you find out in advance if they're expecting you to bring money to the closing and how much and in what payment form. If it's completely no cost then you don't have to worry about that but they still might need money to fund escrow, etc.
Thank you so much. It is a no cost refinance, but I will check with them and confirm if I need to bring money and in what payment form.
I refinanced recently with Owning. You will need to bring money to the table for the prepaid interest and if you are re-establishing an escrow account, or if the new loan amount is not enough to cover the loan payoff for your old lender. They sent a notary to my house but you should know that this notary does not work for Owning or the Escrow company, so you can't ask any questions about the documents while signing. I highly suggest reading everything in advance and asking your processor any questions before the notary gets there. Some of the pages won't be filled out and you'll have to fill them out while there (i.e. a list of your residences for the last 10 years as well as whether you want to avoid funding on a Monday which could cause interest to accrue on both loans over the weekend). It will take at least a couple weeks after signing for your loan to fund after you sign the papers. My loan processor never told me this so it caused a lot of frustration in having to call my new and old lender daily to find out what was going on. Finally, double and triple check your final closing statement which they will recalculate once the funding date is known. Mine was miscalculated (they charged me an extra day of interest on the new loan dated to before the loan was even opened) and I had to get a refund check issued.
need403bhelp
Posts: 1096
Joined: Thu May 28, 2015 6:25 pm

Re: Refinance Mega Thread

Post by need403bhelp »

NORDO wrote: Tue Aug 11, 2020 1:03 pm
Ana Z wrote: Tue Aug 11, 2020 11:10 am
cogito wrote: Tue Aug 11, 2020 11:00 am
Ana Z wrote: Tue Aug 11, 2020 10:56 am Quick question to anyone who worked with Better.com:
After an initial application and preapproval, I get a dashboard of rates and also an option to "review your LE" elsewhere (and this LE does not correspond to anything on the dashboard and is not good). What is my next step? The rates that are listed are not good at all and if these are the actual offers (that is, if they will not change after I go to the next step), I will just drop it here. I don't want to "select a rate" from these or to accidentally commit to anything - just want a genuine estimate to compare to others. I am probably missing something obvious.
Better only displayed their "competitive" rate table for me on their dashboard after I brought them an offer from LenderFi which they beat.
Do I have to contact them by phone for that? Do they really beat the other offers or just match them? Because for me, the difference between them and other offers is very large. Thank you for answering!
Lock your rate, then your primary contact will move to a "processing expert" and that is who you want to email your competitive LE to. Make sure it's within 1 business day of the LE being generated.

Note that once you lock your rate, your rate table is locked, i.e. if the lowest rate in the table is 2.500% and you come to them later with a 2.375% rate to match, they will not go lower than 2.500%.


As others have noted, without the AMEX promo, Better will pretty much just match - the promo was the compelling reason to go with them.
Question for the group.

I have locked LC LE for 2.5% with enough credits to cover closing costs.

I asked better to match (have AmEx promo) and they are giving me their "best rate" which is pretty high. I'm still negotiating with other lenders also, and DO have another LE from LC dated today with slightly better loan credit (so could submit it to processing expert tomorrow).

I'm trying to decide whether to lock better.com rate table and negotiate with processing expert or wait?

Only pro of waiting would be that my rate table has 2.5% as lowest rate, and I'd really like to get a no-cost 2.375% if possible, rather than a 2.5% with a ton of lender credits.

Thanks!
Goal33
Posts: 1466
Joined: Sun Apr 12, 2015 12:30 pm

Re: Refinance Mega Thread

Post by Goal33 »

need403bhelp wrote: Mon Aug 17, 2020 6:41 pm
NORDO wrote: Tue Aug 11, 2020 1:03 pm
Ana Z wrote: Tue Aug 11, 2020 11:10 am
cogito wrote: Tue Aug 11, 2020 11:00 am
Ana Z wrote: Tue Aug 11, 2020 10:56 am Quick question to anyone who worked with Better.com:
After an initial application and preapproval, I get a dashboard of rates and also an option to "review your LE" elsewhere (and this LE does not correspond to anything on the dashboard and is not good). What is my next step? The rates that are listed are not good at all and if these are the actual offers (that is, if they will not change after I go to the next step), I will just drop it here. I don't want to "select a rate" from these or to accidentally commit to anything - just want a genuine estimate to compare to others. I am probably missing something obvious.
Better only displayed their "competitive" rate table for me on their dashboard after I brought them an offer from LenderFi which they beat.
Do I have to contact them by phone for that? Do they really beat the other offers or just match them? Because for me, the difference between them and other offers is very large. Thank you for answering!
Lock your rate, then your primary contact will move to a "processing expert" and that is who you want to email your competitive LE to. Make sure it's within 1 business day of the LE being generated.

Note that once you lock your rate, your rate table is locked, i.e. if the lowest rate in the table is 2.500% and you come to them later with a 2.375% rate to match, they will not go lower than 2.500%.


As others have noted, without the AMEX promo, Better will pretty much just match - the promo was the compelling reason to go with them.
Question for the group.

I have locked LC LE for 2.5% with enough credits to cover closing costs.

I asked better to match (have AmEx promo) and they are giving me their "best rate" which is pretty high. I'm still negotiating with other lenders also, and DO have another LE from LC dated today with slightly better loan credit (so could submit it to processing expert tomorrow).

I'm trying to decide whether to lock better.com rate table and negotiate with processing expert or wait?

Only pro of waiting would be that my rate table has 2.5% as lowest rate, and I'd really like to get a no-cost 2.375% if possible, rather than a 2.5% with a ton of lender credits.

Thanks!
30 year fixed? I don't think there are any 2.375% out there at no-cost... I didn't see many of them posted even on the lowest days 2 weeks ago.
bgh11
Posts: 89
Joined: Wed Aug 05, 2020 4:58 am

Re: Refinance Mega Thread

Post by bgh11 »

Currently in the process of getting a 15-yr 2.625% with $3,100 lender credit to zero out A+B+C combined - no cost basically
If I moved to 2.75% 15-yr, I'd get $1,700 more lender credit net after A+B+C
If I moved to 2.875% 15-yr, I'd get $3,400 more lender credit net after A+B+C
If I moved to 3% 15-yr, I'd get $4,700 more lender credit net after A+B+C
Shorten to 10-yr:
2.500%, cost me $400 more
2.625%, $1,400 more lender credit net after A+B+C
2.750%, $2,900 more lender credit net after A+B+C
2.875%, $4,500 more lender credit net after A+B+C
3.000%, $5,800 more lender credit net after A+B+C

Should I gamble and go with a higher lender credit, hope for rates to go down then refi again? I saw somewhere that there is a $2,000 max cash credit to borrow?
my B+C = $3,100 and above are rates that i would not be able to get today.

Thank you.
need403bhelp
Posts: 1096
Joined: Thu May 28, 2015 6:25 pm

Re: Refinance Mega Thread

Post by need403bhelp »

Goal33 wrote: Mon Aug 17, 2020 6:53 pm
need403bhelp wrote: Mon Aug 17, 2020 6:41 pm
NORDO wrote: Tue Aug 11, 2020 1:03 pm
Ana Z wrote: Tue Aug 11, 2020 11:10 am
cogito wrote: Tue Aug 11, 2020 11:00 am

Better only displayed their "competitive" rate table for me on their dashboard after I brought them an offer from LenderFi which they beat.
Do I have to contact them by phone for that? Do they really beat the other offers or just match them? Because for me, the difference between them and other offers is very large. Thank you for answering!
Lock your rate, then your primary contact will move to a "processing expert" and that is who you want to email your competitive LE to. Make sure it's within 1 business day of the LE being generated.

Note that once you lock your rate, your rate table is locked, i.e. if the lowest rate in the table is 2.500% and you come to them later with a 2.375% rate to match, they will not go lower than 2.500%.


As others have noted, without the AMEX promo, Better will pretty much just match - the promo was the compelling reason to go with them.
Question for the group.

I have locked LC LE for 2.5% with enough credits to cover closing costs.

I asked better to match (have AmEx promo) and they are giving me their "best rate" which is pretty high. I'm still negotiating with other lenders also, and DO have another LE from LC dated today with slightly better loan credit (so could submit it to processing expert tomorrow).

I'm trying to decide whether to lock better.com rate table and negotiate with processing expert or wait?

Only pro of waiting would be that my rate table has 2.5% as lowest rate, and I'd really like to get a no-cost 2.375% if possible, rather than a 2.5% with a ton of lender credits.

Thanks!
30 year fixed? I don't think there are any 2.375% out there at no-cost... I didn't see many of them posted even on the lowest days 2 weeks ago.
Yes 30 year fixed.

I'm starting with 2.5% 30 year fixed no cost so would be ideal to go to 2.375% with negotiations, if possible (may not be).

I guess I could lock with better, then try to match the lender credits on the 2.5% 30 year fixed, then try to have someone else beat that (LD?) taking into account the $2500 AmEx credit by offering me 2.375% no cost?

I'd just really rather have 2.375% rather than 2.5% if I could without closing costs.

Last time I did this offer with Better.com, I used the AmEx credit to buy down the rate. But it seems there would be no option if I lock the current rate table to do that...
User avatar
BrandonBogle
Posts: 3286
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Re: Refinance Mega Thread

Post by BrandonBogle »

need403bhelp wrote: Mon Aug 17, 2020 7:29 pm Yes 30 year fixed.

I'm starting with 2.5% 30 year fixed no cost so would be ideal to go to 2.375% with negotiations, if possible (may not be).

I guess I could lock with better, then try to match the lender credits on the 2.5% 30 year fixed, then try to have someone else beat that (LD?) taking into account the $2500 AmEx credit by offering me 2.375% no cost?

I'd just really rather have 2.375% rather than 2.5% if I could without closing costs.

Last time I did this offer with Better.com, I used the AmEx credit to buy down the rate. But it seems there would be no option if I lock the current rate table to do that...
I would lock the rate table and take my chances. You may find it hard this week to even find another 2.5% at no-cost, and you will have 2-3 weeks to see if something better comes along.
Soares1234
Posts: 78
Joined: Thu Apr 16, 2020 5:50 pm

Re: Refinance Mega Thread

Post by Soares1234 »

Brantley wrote: Mon Aug 17, 2020 6:18 pm I have a close friend who is looking to get a jumbo in Massachusetts. None of the online options mentioned in this thread or on slick deals seem to be doing jumbos. Any suggestions on where to go? He already has a signed offer so he is looking to move quickly.
Try CFBank and consumerdirect mortgage. If you have Costco. Go through costcofinance.com
BarDownHockey
Posts: 68
Joined: Sat Jun 15, 2019 3:58 pm

Re: Refinance Mega Thread

Post by BarDownHockey »

Brantley wrote: Mon Aug 17, 2020 6:18 pm I have a close friend who is looking to get a jumbo in Massachusetts. None of the online options mentioned in this thread or on slick deals seem to be doing jumbos. Any suggestions on where to go? He already has a signed offer so he is looking to move quickly.
You’re going to have much more luck going with banks directly that’ll be servicing the loan. Brokers aren’t playing much in the jumbo space right now because there are so few investors buying jumbo loans. Citi, PNC, Chase, Bank of America, and Schwab are direct lenders I’ve read in other threads that people have done jumbo’s with recently.

Now as far as having luck finding a no cost jumbo loan, that’s going to be really really hard right now. Not impossible, but it’s going to take some serious shopping. But in terms of just getting a jumbo loan, the banks above have been doing jumbo refi’s (so they’ll likely do a jumbo purchase loan).
chaalo_aavjo
Posts: 5
Joined: Sat Aug 15, 2020 4:01 pm

Re: Refinance Mega Thread

Post by chaalo_aavjo »

KeepinItPositive wrote: Mon Aug 17, 2020 5:04 pm
chaalo_aavjo wrote: Mon Aug 17, 2020 4:41 pm Hello Everyone,

I'm hoping someone can help me understand how to compare two options. So far I've only seen discussions on comparing rate quotes and fees between two lenders but haven't seen much talk about loan amount vs. payoff amount.

In my specific scenario, LF provided an LE for 2.5% 30yr fixed with enough lender credits to bring down closing cost to basically $30 after all fess, prepaids, etc. In the LE, the loan amount is listed just over $409k. This number matches the balance on the current mortgage as shown in the credit report.

I had shared the LE with my current lender and they agreed to match the offer. However, when looking at the "Details of Transaction" section in the application package I received today, following info is listed:

d: The refinance amount is listed at just under $411k. I was told that this is the payoff amount on the current mortgage which takes into account
the interest paid in arrears (i.e. mortgage balance reported on credit report isn't the same as payoff amount).
e: Roughly $300 in prepaid interest.
f: Closing fees of $2000
h: Discount of ($2000)
m: The loan amount is listed as $410k
p: Cash to close $1300

My understanding is that the total cash required at closing (d+e+f+h)-m) is not really a "fee" but a way to effectively take care of the interest calculations. The end result of this is that I get to skip one payment.

Now from what I was told, d and e will obviously change depending on when closing takes place (roughly 3 weeks from now). I will make one payment between now and closing so d will decrease. If let's say we decide on closing exactly 1 month from now, e will remain about the same.

Now here's the question. Am I correct to assume that the LE I received from LF is not taking in to account the payoff cost? Or are they eating the difference between payoff amount (~411k) on current mortgage and the listed loan amount (~409k)? I highly doubt that is the case and assume that the numbers would be "updated" in the final paperwork.

Or the other scenario is that their numbers are correct, in which case I would not be skipping a month of payment as I would be in the scenario given by the current lender?
For me I’m looking at The amount in d to be offset by the lender credit to be true no cost. I would expect the loan amount will get squared away so I wouldn’t look at that a deciding factor.

When did you get your 2.5/30/no cost LE?
The 2.5/30/no cost was received first week of Aug from LF.
The amount in d to be offset by the lender credit to be true no cost.
When you say "amount in d", I assume you are referring to the LE. If so, than it appears both lenders are offering enough credit to do so. Where I'm getting stuck at is, did LF take into account the payoff account when they sent me the LE? It seems they just made the loan amount = mortgage balance from the credit report. But that doesn't mean it's the payoff amount. So there will be a gap between the payoff amount and the loan amount. Who covers that gap? The LE does not make any mention of this...or am I reading the LE wrong?
m7a8a6
Posts: 19
Joined: Mon Aug 17, 2020 8:25 pm

Re: Refinance Mega Thread

Post by m7a8a6 »

Hello everyone. First post from a long time novice lurking and sucking up all the wisdom from everyone(thank you). I couldn’t help but finally create an account because I’m just failing at making progress on this one.

I’m surprised at how everyone is able to get such low interest rates. I’m not able to find any refinance offers with no cost..or even low cost for my refinance goals. Loan officers told me straight up there are no offerings that are going to be net low or no cost.

I have excellent credit (815+), steady FT employment, 250k/30 yr loan at 4.5% in NJ.

Better - 3.0% at 7k in closing
Aimloan - 3.0% at 5.5k in closing
LD - 3.0% at 5k in closing
Ran through credible, lending tree, rocket mortgage but all had high costs.

I’m definitely doing something wrong. What’s the best strategy to achieve getting lenders to offer no cost?
e5116
Posts: 600
Joined: Mon Oct 05, 2009 11:22 am

Re: Refinance Mega Thread

Post by e5116 »

chaalo_aavjo wrote: Mon Aug 17, 2020 8:31 pm
KeepinItPositive wrote: Mon Aug 17, 2020 5:04 pm
chaalo_aavjo wrote: Mon Aug 17, 2020 4:41 pm Hello Everyone,

I'm hoping someone can help me understand how to compare two options. So far I've only seen discussions on comparing rate quotes and fees between two lenders but haven't seen much talk about loan amount vs. payoff amount.

In my specific scenario, LF provided an LE for 2.5% 30yr fixed with enough lender credits to bring down closing cost to basically $30 after all fess, prepaids, etc. In the LE, the loan amount is listed just over $409k. This number matches the balance on the current mortgage as shown in the credit report.

I had shared the LE with my current lender and they agreed to match the offer. However, when looking at the "Details of Transaction" section in the application package I received today, following info is listed:

d: The refinance amount is listed at just under $411k. I was told that this is the payoff amount on the current mortgage which takes into account
the interest paid in arrears (i.e. mortgage balance reported on credit report isn't the same as payoff amount).
e: Roughly $300 in prepaid interest.
f: Closing fees of $2000
h: Discount of ($2000)
m: The loan amount is listed as $410k
p: Cash to close $1300

My understanding is that the total cash required at closing (d+e+f+h)-m) is not really a "fee" but a way to effectively take care of the interest calculations. The end result of this is that I get to skip one payment.

Now from what I was told, d and e will obviously change depending on when closing takes place (roughly 3 weeks from now). I will make one payment between now and closing so d will decrease. If let's say we decide on closing exactly 1 month from now, e will remain about the same.

Now here's the question. Am I correct to assume that the LE I received from LF is not taking in to account the payoff cost? Or are they eating the difference between payoff amount (~411k) on current mortgage and the listed loan amount (~409k)? I highly doubt that is the case and assume that the numbers would be "updated" in the final paperwork.

Or the other scenario is that their numbers are correct, in which case I would not be skipping a month of payment as I would be in the scenario given by the current lender?
For me I’m looking at The amount in d to be offset by the lender credit to be true no cost. I would expect the loan amount will get squared away so I wouldn’t look at that a deciding factor.

When did you get your 2.5/30/no cost LE?
The 2.5/30/no cost was received first week of Aug from LF.
The amount in d to be offset by the lender credit to be true no cost.
The question is, did LF take that into account when they sent me the LE? It seems they just made the loan amount = mortgage balance from the credit report. But that doesn't mean it's the payoff amount. So there will be a gap between the payoff amount and the loan amount. Who covers that gap? The LE does not make any mention of this...or am I reading the LE wrong?
You are responsible for paying any gap in the payoff amount at closing. But it's not something that you wouldn't have to pay anyways. It's basically interest, etc. that accumulated in the partial month. So you're not double paying. The payoff amount will change daily, so it's a moving target but will be fully tied out at closing (or if somehow you overpay, your old lender will owe you a refund check).

I too had the loan amount = mortgage balance but payoff amount was larger. Even though I had a "no cost" refi, I still had to bring $5k or so to closing....to fund prepaids/escrow, payoff amount, etc. I did get a refund check for my old escrow account a few weeks later that covered a sizable chunk of that. They at first wrote the LE with loan amount = payoff and I asked them to change it...
jbell3124
Posts: 46
Joined: Tue Jul 16, 2013 10:53 pm

Re: Refinance Mega Thread

Post by jbell3124 »

I locked in a no-cost 2.5% 30 year no escrow with Watermark a few hours before the 0.5% fee got handed down. I obviously consider myself very fortunate. Better called soon after. They will not match the offer which is a bummer since I will be missing out on the AMEX bonus. I never locked with Better. Their LE showed about $9000 in CC to get the 2.5%. Think it is worth the effort to lock with Better and then see if they will negotiate (sounds doubtful by the sound of things)? I don't want to take a higher rate just to get the AMEX considering what I gain from the lower rate in the long term. I have nothing but good things to say about Watermark to date. Complicating things is that my Lenderfi 6 month window ends in late September. I'm worried that if Better did match, the closing date would be well before that, possibly jeopardizing my LF lender credits from March but how knows. The Watermark closing date should line up well with the end of that 6 month window.
need403bhelp
Posts: 1096
Joined: Thu May 28, 2015 6:25 pm

Re: Refinance Mega Thread

Post by need403bhelp »

BrandonBogle wrote: Mon Aug 17, 2020 7:37 pm
need403bhelp wrote: Mon Aug 17, 2020 7:29 pm Yes 30 year fixed.

I'm starting with 2.5% 30 year fixed no cost so would be ideal to go to 2.375% with negotiations, if possible (may not be).

I guess I could lock with better, then try to match the lender credits on the 2.5% 30 year fixed, then try to have someone else beat that (LD?) taking into account the $2500 AmEx credit by offering me 2.375% no cost?

I'd just really rather have 2.375% rather than 2.5% if I could without closing costs.

Last time I did this offer with Better.com, I used the AmEx credit to buy down the rate. But it seems there would be no option if I lock the current rate table to do that...
I would lock the rate table and take my chances. You may find it hard this week to even find another 2.5% at no-cost, and you will have 2-3 weeks to see if something better comes along.
Thanks for your thoughts.

Just to clarify, I *already* have a locked 2.5% at close to no-cost with LoanCabin.

This is not true from their loan estimate per se which has the following (my adjustments based on prior refi/state law in brackets):
A - $0
B - $500 ($250 of this is going away based on my last refi, as it is an HOA fee which my HOA doesn't charge, so $250)
C - $3,169 (this has a survey listed which I already have so -$539, the title insurance is always screwed up in my state on LEs as it is mandated by law and they have reissue rates; I'm also not going with their title company ; my last refi post-consummation closing disclosure showed $1,578.05 which included attorney fee which LC lists in B, so should be around $1,428 or likely a little less with title company using for LC which is known entity to me)
D - $3,669 (but based on my calculations above should end up being $250 + $1,428 = $1,678)
E - $172
F - $11,598 (their title company requires 12 months of property taxes despite not having escrow, but I'm not using their title company)
G - $0
J - lender credits -$1,550

So should be around $300 to close based on my calculations.

Although I guess I could try to get that lower so would be advantage of locking with Better.com...

Thanks for your advice!

EDIT: I re-read your post and I think you were just saying it would be hard to find a 2.375% no-cost or something similar to try to get better.com to match. Thanks!
wootwoot
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Re: Refinance Mega Thread

Post by wootwoot »

jbell3124 wrote: Mon Aug 17, 2020 8:47 pm I locked in a no-cost 2.5% 30 year no escrow with Watermark a few hours before the 0.5% fee got handed down. I obviously consider myself very fortunate. Better called soon after. They will not match the offer which is a bummer since I will be missing out on the AMEX bonus. I never locked with Better. Their LE showed about $9000 in CC to get the 2.5%. Think it is worth the effort to lock with Better and then see if they will negotiate (sounds doubtful by the sound of things)? I don't want to take a higher rate just to get the AMEX considering what I gain from the lower rate in the long term. I have nothing but good things to say about Watermark to date. Complicating things is that my Lenderfi 6 month window ends in late September. I'm worried that if Better did match, the closing date would be well before that, possibly jeopardizing my LF lender credits from March but how knows. The Watermark closing date should line up well with the end of that 6 month window.
It's far too late for the Amex bonus anyways so nothing lost there.
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BrandonBogle
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Post by BrandonBogle »

chaalo_aavjo wrote: Mon Aug 17, 2020 8:31 pm Where I'm getting stuck at is, did LF take into account the payoff account when they sent me the LE? It seems they just made the loan amount = mortgage balance from the credit report. But that doesn't mean it's the payoff amount. So there will be a gap between the payoff amount and the loan amount. Who covers that gap? The LE does not make any mention of this...or am I reading the LE wrong?
You are overthinking this. The LE is a loan estimate based on input numbers, not the verified data underwriting uses. If you choose to proceed with them, one of the steps is for them to obtain a payoff quote from your existing lender vs. going by your application amount.

It isn’t anything set in stone that cannot change (as long as your income/other debt support the increased amount). At most, when you give them the intent to proceed, you could mention that the loan amount currently is insufficient to pay off the existing loan and you want to make sure they get an updated payoff before closing.
joelly
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Re: Refinance Mega Thread

Post by joelly »

mags wrote: Sun Aug 16, 2020 8:30 am
joelly wrote: Sat Aug 15, 2020 8:06 pm
mags wrote: Fri Aug 14, 2020 10:24 pm I just closed on a Lender Fi 30 year fixed 2.75% with $400 closing costs.
Wow congratulations!

We are looking for refinance too. How did you get such low interest rate? Does it depend on loan-to-value ratio? I hope you don’t mind me asking.
Loan is (conforming) 540k on 1.2M house. 815 credit score.
What does conforming means?

Thanks in advance for replying.
jbell3124
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Re: Refinance Mega Thread

Post by jbell3124 »

wootwoot wrote: Mon Aug 17, 2020 9:03 pm
jbell3124 wrote: Mon Aug 17, 2020 8:47 pm I locked in a no-cost 2.5% 30 year no escrow with Watermark a few hours before the 0.5% fee got handed down. I obviously consider myself very fortunate. Better called soon after. They will not match the offer which is a bummer since I will be missing out on the AMEX bonus. I never locked with Better. Their LE showed about $9000 in CC to get the 2.5%. Think it is worth the effort to lock with Better and then see if they will negotiate (sounds doubtful by the sound of things)? I don't want to take a higher rate just to get the AMEX considering what I gain from the lower rate in the long term. I have nothing but good things to say about Watermark to date. Complicating things is that my Lenderfi 6 month window ends in late September. I'm worried that if Better did match, the closing date would be well before that, possibly jeopardizing my LF lender credits from March but how knows. The Watermark closing date should line up well with the end of that 6 month window.
It's far too late for the Amex bonus anyways so nothing lost there.
Actually, I applied by the deadline and am still eligible for the AMEX bonus. It just doesn’t look like it will make sense for me to try to pursue given recent developments.
bgh11
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Post by bgh11 »

Mortgage amount below $510,400 for most
https://singlefamily.fanniemae.com/orig ... oan-limits
joelly wrote: Mon Aug 17, 2020 9:09 pm
mags wrote: Sun Aug 16, 2020 8:30 am
joelly wrote: Sat Aug 15, 2020 8:06 pm
mags wrote: Fri Aug 14, 2020 10:24 pm I just closed on a Lender Fi 30 year fixed 2.75% with $400 closing costs.
Wow congratulations!

We are looking for refinance too. How did you get such low interest rate? Does it depend on loan-to-value ratio? I hope you don’t mind me asking.
Loan is (conforming) 540k on 1.2M house. 815 credit score.
What does conforming means?

Thanks in advance for replying.
chaalo_aavjo
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Re: Refinance Mega Thread

Post by chaalo_aavjo »

e5116 wrote: Mon Aug 17, 2020 8:41 pm
The amount in d to be offset by the lender credit to be true no cost.
The question is, did LF take that into account when they sent me the LE? It seems they just made the loan amount = mortgage balance from the credit report. But that doesn't mean it's the payoff amount. So there will be a gap between the payoff amount and the loan amount. Who covers that gap? The LE does not make any mention of this...or am I reading the LE wrong?
You are responsible for paying any gap in the payoff amount at closing. But it's not something that you wouldn't have to pay anyways. It's basically interest, etc. that accumulated in the partial month. So you're not double paying. The payoff amount will change daily, so it's a moving target but will be fully tied out at closing (or if somehow you overpay, your old lender will owe you a refund check).

I too had the loan amount = mortgage balance but payoff amount was larger. Even though I had a "no cost" refi, I still had to bring $5k or so to closing....to fund prepaids/escrow, payoff amount, etc. I did get a refund check for my old escrow account a few weeks later that covered a sizable chunk of that. They at first wrote the LE with loan amount = payoff and I asked them to change it...
Yup, that's how the loan officer explained it to me. The payoff amount is usually a bit higher than the loan balance and it's mostly due to the arrears interest. There might be a small fee here or there to tie everything up but it's mostly the interest.
BrandonBogle wrote: Mon Aug 17, 2020 9:06 pm
chaalo_aavjo wrote: Mon Aug 17, 2020 8:31 pm Where I'm getting stuck at is, did LF take into account the payoff account when they sent me the LE? It seems they just made the loan amount = mortgage balance from the credit report. But that doesn't mean it's the payoff amount. So there will be a gap between the payoff amount and the loan amount. Who covers that gap? The LE does not make any mention of this...or am I reading the LE wrong?
You are overthinking this. The LE is a loan estimate based on input numbers, not the verified data underwriting uses. If you choose to proceed with them, one of the steps is for them to obtain a payoff quote from your existing lender vs. going by your application amount.

It isn’t anything set in stone that cannot change (as long as your income/other debt support the increased amount). At most, when you give them the intent to proceed, you could mention that the loan amount currently is insufficient to pay off the existing loan and you want to make sure they get an updated payoff before closing.
Overthinking things is one of my core competencies :oops:

Anywhoo...Your explanation is what I was looking for so definitely appreciate it! Basically the payoff amount is going to be the same regardless of which lender I choose. And in the case that the loan amount was lower than the payoff amount, I'd have to cover the difference at the closing or just ask the lender to adjust the loan amount to be equal to the payoff amount so that the only thing I'd be responsible at closing then would be the prepaid (since both lenders are willing to include enough credits to cover all other fees).
thrillhou
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Post by thrillhou »

chaalo_aavjo wrote: Mon Aug 17, 2020 9:41 pm
e5116 wrote: Mon Aug 17, 2020 8:41 pm
The amount in d to be offset by the lender credit to be true no cost.
The question is, did LF take that into account when they sent me the LE? It seems they just made the loan amount = mortgage balance from the credit report. But that doesn't mean it's the payoff amount. So there will be a gap between the payoff amount and the loan amount. Who covers that gap? The LE does not make any mention of this...or am I reading the LE wrong?
You are responsible for paying any gap in the payoff amount at closing. But it's not something that you wouldn't have to pay anyways. It's basically interest, etc. that accumulated in the partial month. So you're not double paying. The payoff amount will change daily, so it's a moving target but will be fully tied out at closing (or if somehow you overpay, your old lender will owe you a refund check).

I too had the loan amount = mortgage balance but payoff amount was larger. Even though I had a "no cost" refi, I still had to bring $5k or so to closing....to fund prepaids/escrow, payoff amount, etc. I did get a refund check for my old escrow account a few weeks later that covered a sizable chunk of that. They at first wrote the LE with loan amount = payoff and I asked them to change it...
Yup, that's how the loan officer explained it to me. The payoff amount is usually a bit higher than the loan balance and it's mostly due to the arrears interest. There might be a small fee here or there to tie everything up but it's mostly the interest.
BrandonBogle wrote: Mon Aug 17, 2020 9:06 pm
chaalo_aavjo wrote: Mon Aug 17, 2020 8:31 pm Where I'm getting stuck at is, did LF take into account the payoff account when they sent me the LE? It seems they just made the loan amount = mortgage balance from the credit report. But that doesn't mean it's the payoff amount. So there will be a gap between the payoff amount and the loan amount. Who covers that gap? The LE does not make any mention of this...or am I reading the LE wrong?
You are overthinking this. The LE is a loan estimate based on input numbers, not the verified data underwriting uses. If you choose to proceed with them, one of the steps is for them to obtain a payoff quote from your existing lender vs. going by your application amount.

It isn’t anything set in stone that cannot change (as long as your income/other debt support the increased amount). At most, when you give them the intent to proceed, you could mention that the loan amount currently is insufficient to pay off the existing loan and you want to make sure they get an updated payoff before closing.
Overthinking things is one of my core competencies :oops:

Anywhoo...Your explanation is what I was looking for so definitely appreciate it! Basically the payoff amount is going to be the same regardless of which lender I choose. And in the case that the loan amount was lower than the payoff amount, I'd have to cover the difference at the closing or just ask the lender to adjust the loan amount to be equal to the payoff amount so that the only thing I'd be responsible at closing then would be the prepaid (since both lenders are willing to include enough credits to cover all other fees).
To add based on my recent experience: At least 3 days before closing (i.e., signing with a notary), my lender sent me an official Closing Document (CD). In my words; the CD is an updated version of the LE in that it has better info about the amount of the loan and interest per diem for both the old and new loans.

Also, remember that you could make the new loan less than what's on your statement -- by brining money to the table. You can also increase the amount of your loan from your statement (or credit report), by rolling things into it. It won't be exact (which is something I has thought should be 'easy'), and depending on your new lender, they will either want to refund you money on a slightly 'too big a loan' or over-estimate how much you need to bring to the table and then refund some of that money back. (For me, the biggest place they 'padded' the money to bring to the table was in how much overlap there was in calculating the two loans' per diem. They targeted Aug 20 for funding. But, for the old loan, they calculated through Sept 5. For new loan it was Aug 20. So obviously, there is a lot of overlapped days' interest that I effectively 'brought to the table' at signing.)
PharmerBrown
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Re: Refinance Mega Thread

Post by PharmerBrown »

m7a8a6 wrote: Mon Aug 17, 2020 8:38 pm Hello everyone. First post from a long time novice lurking and sucking up all the wisdom from everyone(thank you). I couldn’t help but finally create an account because I’m just failing at making progress on this one.

I’m surprised at how everyone is able to get such low interest rates. I’m not able to find any refinance offers with no cost..or even low cost for my refinance goals. Loan officers told me straight up there are no offerings that are going to be net low or no cost.

I have excellent credit (815+), steady FT employment, 250k/30 yr loan at 4.5% in NJ.

Better - 3.0% at 7k in closing
Aimloan - 3.0% at 5.5k in closing
LD - 3.0% at 5k in closing
Ran through credible, lending tree, rocket mortgage but all had high costs.

I’m definitely doing something wrong. What’s the best strategy to achieve getting lenders to offer no cost?
How much of those closing costs are going toward your escrow?
psychoslowmatic
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Re: Refinance Mega Thread

Post by psychoslowmatic »

I put my money where my mouth is and applied with Third Federal for my small loan balance. I'm in NH, owe 127k on 260k (49% LTV) and currently am in year 6 of a Penfed 5/5 at 3.3125%. I applied for Third Federal's 10 year fixed at 2.79%, fixed $295 closing costs. I could maybe get closer to 2.5% on a 15 year but for no work I'm happy.

Applied Sunday, processor reached out Monday around 1pm via email with a link to their document upload portal and requested documents. Will update with any shenanigans.

Couple other details - they don't require escrow if <75% LTV, and they charge no premium for cash out and will go up to 80% on a cash out. I couldn't think of a good use for the cash and didn't want to complicate my taxes tracking the cash out portion of my paid interest.
chaalo_aavjo
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Re: Refinance Mega Thread

Post by chaalo_aavjo »

thrillhou wrote: Mon Aug 17, 2020 9:51 pm
BrandonBogle wrote: Mon Aug 17, 2020 9:06 pm
chaalo_aavjo wrote: Mon Aug 17, 2020 8:31 pm Where I'm getting stuck at is, did LF take into account the payoff account when they sent me the LE? It seems they just made the loan amount = mortgage balance from the credit report. But that doesn't mean it's the payoff amount. So there will be a gap between the payoff amount and the loan amount. Who covers that gap? The LE does not make any mention of this...or am I reading the LE wrong?
You are overthinking this. The LE is a loan estimate based on input numbers, not the verified data underwriting uses. If you choose to proceed with them, one of the steps is for them to obtain a payoff quote from your existing lender vs. going by your application amount.

It isn’t anything set in stone that cannot change (as long as your income/other debt support the increased amount). At most, when you give them the intent to proceed, you could mention that the loan amount currently is insufficient to pay off the existing loan and you want to make sure they get an updated payoff before closing.
Overthinking things is one of my core competencies :oops:

Anywhoo...Your explanation is what I was looking for so definitely appreciate it! Basically the payoff amount is going to be the same regardless of which lender I choose. And in the case that the loan amount was lower than the payoff amount, I'd have to cover the difference at the closing or just ask the lender to adjust the loan amount to be equal to the payoff amount so that the only thing I'd be responsible at closing then would be the prepaid (since both lenders are willing to include enough credits to cover all other fees).
To add based on my recent experience: At least 3 days before closing (i.e., signing with a notary), my lender sent me an official Closing Document (CD). In my words; the CD is an updated version of the LE in that it has better info about the amount of the loan and interest per diem for both the old and new loans.

Also, remember that you could make the new loan less than what's on your statement -- by brining money to the table. You can also increase the amount of your loan from your statement (or credit report), by rolling things into it. It won't be exact (which is something I has thought should be 'easy'), and depending on your new lender, they will either want to refund you money on a slightly 'too big a loan' or over-estimate how much you need to bring to the table and then refund some of that money back. (For me, the biggest place they 'padded' the money to bring to the table was in how much overlap there was in calculating the two loans' per diem. They targeted Aug 20 for funding. But, for the old loan, they calculated through Sept 5. For new loan it was Aug 20. So obviously, there is a lot of overlapped days' interest that I effectively 'brought to the table' at signing.)
Yup, the numbers I reviewed today with the loan officer were definitely padded in terms of the interest calculations. Anyways, looks like I have my answer about how the final loan amount works in relation to the payoff amount.

Thank you guys for walking me thorough it, much appreciated!

Although LF offered a pretty competitive quote right off the bet, my current lender (Chase) matched the quote/credits so will be staying with them. It keeps things fairly easy and simple for me since I have a lot of other financial relationships with them. Also Chase will obviously service the loan instead of passing it on to someone else so that's good in terms of customer service. Plus, this is the second time this particular LO at Chase has done legwork to match a competitors offer to keep my business so that positive business relationship is also very valuable.
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BrandonBogle
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Post by BrandonBogle »

psychoslowmatic wrote: Mon Aug 17, 2020 9:59 pm Couple other details - they don't require escrow if <75% LTV, and they charge no premium for cash out and will go up to 80% on a cash out. I couldn't think of a good use for the cash and didn't want to complicate my taxes tracking the cash out portion of my paid interest.
Ooh, there’s a thought. I could do a cash out to get in that sweet spot of those great refi offers and then refi with the larger loan in six months. What was that about overthinking things chaalo_aavjo was talking about?!? :D

Do let us know how things go (as you are planning to already). Third Federal is my fallback if things go south and I can’t find a good offer to refi on a 15/30 year.
need403bhelp
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Re: Refinance Mega Thread

Post by need403bhelp »

BrandonBogle wrote: Mon Aug 17, 2020 7:37 pm
need403bhelp wrote: Mon Aug 17, 2020 7:29 pm Yes 30 year fixed.

I'm starting with 2.5% 30 year fixed no cost so would be ideal to go to 2.375% with negotiations, if possible (may not be).

I guess I could lock with better, then try to match the lender credits on the 2.5% 30 year fixed, then try to have someone else beat that (LD?) taking into account the $2500 AmEx credit by offering me 2.375% no cost?

I'd just really rather have 2.375% rather than 2.5% if I could without closing costs.

Last time I did this offer with Better.com, I used the AmEx credit to buy down the rate. But it seems there would be no option if I lock the current rate table to do that...
I would lock the rate table and take my chances. You may find it hard this week to even find another 2.5% at no-cost, and you will have 2-3 weeks to see if something better comes along.
Thanks, so I locked my loan but I think I'm screwed if I understand better processing expert match datapoints correctly.

Looked up my loan processor on NMLS consumer access and they are not licensed in my state :(

In any case, I'll go ahead and send her the new LE tomorrow morning, but I'm guessing she just kicks it back to the concierge...

Do let me know if you have any tips please.

Thanks!
illnevertell
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Re: Refinance Mega Thread

Post by illnevertell »

I applied at Loan Cabin on 7/27 - I see they are reviewing applications for those who applied on 7/30. Never was even contacted by them. Kind of a joke, there isn't even a number or an email that you can reach out to in order to follow up.
need403bhelp
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Re: Refinance Mega Thread

Post by need403bhelp »

illnevertell wrote: Mon Aug 17, 2020 11:25 pm I applied at Loan Cabin on 7/27 - I see they are reviewing applications for those who applied on 7/30. Never was even contacted by them. Kind of a joke, there isn't even a number or an email that you can reach out to in order to follow up.
You can try complaints at loancabin dot com.

They also do have a phone number on their website
illnevertell
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Post by illnevertell »

I tried the phone and the email. Never once got someone to answer or respond.
schwank
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Post by schwank »

In return for all the data in this thread I offer my own experience... I cross shopped BankRate, better.com, Quicken Loans, aimloan.com, loandepot.com, and LenderFi. Today I locked the following (escrow included) through LoanDepot. My rep was really straightforward and optimized the approval process based on our incomes to shorten the underwriting period.

15 year fixed @ 2.375%
$0 closing costs
$975 escrow credit
$480k on a $650k home
Appraisal required - refi on a 2019 custom home in a 1940s neighborhood in metro Portland, OR
blueleaf
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Re: Refinance Mega Thread

Post by blueleaf »

Can someone help me understand escrow?

I'm looking to refinance my mortgage, currently considering no cost refinance options with lenderfi and aimloan. On my current loan, I don't have an escrow for property taxes or insurance - i pay them directly.

For refinance, it looks like rates are slightly better if I choose an escrow option. Does this mean I have to fork over a year's worth of property taxes at close of the refinance for the bank to hold? Or just that I pay 1/12 of the annual property tax each month along with the mortgage payment?

Do these lenders offer an option of rolling the up front escrow amount into the refinanced loan, and if so is that a good option?

Thank you for any help you can provide.
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yatesd
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Re: Refinance Mega Thread

Post by yatesd »

m7a8a6 wrote: Mon Aug 17, 2020 8:38 pm Hello everyone. First post from a long time novice lurking and sucking up all the wisdom from everyone(thank you). I couldn’t help but finally create an account because I’m just failing at making progress on this one.

I’m surprised at how everyone is able to get such low interest rates. I’m not able to find any refinance offers with no cost..or even low cost for my refinance goals. Loan officers told me straight up there are no offerings that are going to be net low or no cost.

I have excellent credit (815+), steady FT employment, 250k/30 yr loan at 4.5% in NJ.

Better - 3.0% at 7k in closing
Aimloan - 3.0% at 5.5k in closing
LD - 3.0% at 5k in closing
Ran through credible, lending tree, rocket mortgage but all had high costs.

I’m definitely doing something wrong. What’s the best strategy to achieve getting lenders to offer no cost?
Welcome to Bogleheads! Please provide a breakdown so we can understand your offer. Also, make sure you are focusing on "cost" of loan & related fees (title insurance, doc fees), versus interest overlap and escrow that will be variable, paid up front, with much of this rebated with any overpayment by the previous lender.
teCh0010
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Re: Refinance Mega Threadve

Post by teCh0010 »

yatesd wrote: Tue Aug 18, 2020 4:13 am
m7a8a6 wrote: Mon Aug 17, 2020 8:38 pm Hello everyone. First post from a long time novice lurking and sucking up all the wisdom from everyone(thank you). I couldn’t help but finally create an account because I’m just failing at making progress on this one.

I’m surprised at how everyone is able to get such low interest rates. I’m not able to find any refinance offers with no cost..or even low cost for my refinance goals. Loan officers told me straight up there are no offerings that are going to be net low or no cost.

I have excellent credit (815+), steady FT employment, 250k/30 yr loan at 4.5% in NJ.

Better - 3.0% at 7k in closing
Aimloan - 3.0% at 5.5k in closing
LD - 3.0% at 5k in closing
Ran through credible, lending tree, rocket mortgage but all had high costs.

I’m definitely doing something wrong. What’s the best strategy to achieve getting lenders to offer no cost?
Welcome to Bogleheads! Please provide a breakdown so we can understand your offer. Also, make sure you are focusing on "cost" of loan & related fees (title insurance, doc fees), versus interest overlap and escrow that will be variable, paid up front, with much of this rebated with any overpayment by the previous lender.
Your loan amount impacts your rates. When I played with the Costco calculator I put in 270k and 330k, got a lower rate on 330k. At 250k you may not get quite as good a rate as some other people.
jimmyrules712
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Re: Refinance Mega Thread

Post by jimmyrules712 »

need403bhelp wrote: Mon Aug 17, 2020 6:41 pm I'd really like to get a no-cost 2.375% if possible, rather than a 2.5% with a ton of lender credits.
This sentence doesn't make sense. Lender credits are what makes a given rate "no-cost". The only way you'll get a 2.375% for "no-cost" is with "a ton of lender credits".
MrJedi
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Re: Refinance Mega Thread

Post by MrJedi »

jimmyrules712 wrote: Tue Aug 18, 2020 7:52 am
need403bhelp wrote: Mon Aug 17, 2020 6:41 pm I'd really like to get a no-cost 2.375% if possible, rather than a 2.5% with a ton of lender credits.
This sentence doesn't make sense. Lender credits are what makes a given rate "no-cost". The only way you'll get a 2.375% for "no-cost" is with "a ton of lender credits".
They can maybe clarify but I read that as 2.375% no cost is preferred over 2.5% no cost + enough credits to result in effective "cashback".
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BrandonBogle
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Re: Refinance Mega Thread

Post by BrandonBogle »

need403bhelp wrote: Mon Aug 17, 2020 11:02 pm Thanks, so I locked my loan but I think I'm screwed if I understand better processing expert match datapoints correctly.

Looked up my loan processor on NMLS consumer access and they are not licensed in my state :(

In any case, I'll go ahead and send her the new LE tomorrow morning, but I'm guessing she just kicks it back to the concierge...

Do let me know if you have any tips please.

Thanks!
My processor was not licensed in my state either and had to involve my concierge to do the work. But it was no problem getting a second rate match (even when my concierge said I was at their “best” pricing). Somewhere upthread (at least I think it was this thread) I discussed how each person has access to their own slice of the pie of matching funds and their own slice of other pies for discounts. So you may end up just fine with this second match.
MrJedi wrote: Tue Aug 18, 2020 7:58 am
jimmyrules712 wrote: Tue Aug 18, 2020 7:52 am
need403bhelp wrote: Mon Aug 17, 2020 6:41 pm I'd really like to get a no-cost 2.375% if possible, rather than a 2.5% with a ton of lender credits.
This sentence doesn't make sense. Lender credits are what makes a given rate "no-cost". The only way you'll get a 2.375% for "no-cost" is with "a ton of lender credits".
They can maybe clarify but I read that as 2.375% no cost is preferred over 2.5% no cost + enough credits to result in effective "cashback".
+1, that’s how I read it as well.
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BrandonBogle
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Re: Refinance Mega Thread

Post by BrandonBogle »

blueleaf wrote: Tue Aug 18, 2020 2:07 am For refinance, it looks like rates are slightly better if I choose an escrow option. Does this mean I have to fork over a year's worth of property taxes at close of the refinance for the bank to hold? Or just that I pay 1/12 of the annual property tax each month along with the mortgage payment?

Do these lenders offer an option of rolling the up front escrow amount into the refinanced loan, and if so is that a good option?
Keep in mind homeowners insurance is usually included as well. You typically will see a minimum of 2/12 held (they are allowed to keep a two-month sized reserve for pricing variations year-to-year). However, if you have a payment due within 2-3 months of your closing, they will collect that payment due in addition to the above numbers.

And yes, you can roll in the up front costs as long as your income and other debt would still qualify you for the higher amount.

Generally speaking, folks try to avoid that as you would then be paying finance charges on that money for 15-30 years. However, this doesn’t consider that you could pay down that amount early. This doesn’t apply in your case, but if you already had an escrow account, you might choose to finance the closing costs and then in about two weeks when you get your refund of your old escrow account, you include that as additional principal in your monthly payment.

You may also find that financing this comes out financially advantageous. In my case, my taxes are due in Sept (but payable until Jan without penalty). They were collected in addition to my escrow funding. I financed these and the increased loan amount actually enabled a $425 higher lender credit. So I earned $425 more (before interest costs) by financing a few thousand. Meanwhile, I would apply the payment I was going to make (I didn’t have an escrow on the old mortgage) to pay down this loan if I wasn’t going to refinance it again anyway.
Familyman2012
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Re: Refinance Mega Thread

Post by Familyman2012 »

I talked to both WM and LF yesterday. Both of them stated that the 0.5 fee is already added in the closing fees. I asked them to clarify what that exactly means.

WM said that even if I locked last month. They’re 45 days out from closing. They have been calling 100s of applications that’s in process to break the news to them that they’ll have to pay 0.5 fee.

LF said 0.5 fees are added already and nothing we can do about it.
Ryzen
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Re: Refinance Mega Thread

Post by Ryzen »

Familyman2012 wrote: Tue Aug 18, 2020 9:14 am I talked to both WM and LF yesterday. Both of them stated that the 0.5 fee is already added in the closing fees. I asked them to clarify what that exactly means.

WM said that even if I locked last month. They’re 45 days out from closing. They have been calling 100s of applications that’s in process to break the news to them that they’ll have to pay 0.5 fee.

LF said 0.5 fees are added already and nothing we can do about it.
Again, the 0.5% fee will not be itemized and nobody will know it is included unless they specifically ask (and, for the record, yes it is included - with no exceptions - for every refinance loan that will be sold [not closed, the sale to FNMA occurs after closing] to FNMA after September 1). It is rolled into the rate/credits offered as it is a back end adjustment.

Lenders are mad at FNMA because it was so short notice. If they sell a loan after 9/1, they have to pay this fee. This is a new precedent, since the GSE's have never done something like this with such short notice. Now lenders have to consider that the GSE's can change the rules going forward with no notice.
keystone
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Re: Refinance Mega Thread

Post by keystone »

Ryzen wrote: Tue Aug 18, 2020 9:18 am
Familyman2012 wrote: Tue Aug 18, 2020 9:14 am I talked to both WM and LF yesterday. Both of them stated that the 0.5 fee is already added in the closing fees. I asked them to clarify what that exactly means.

WM said that even if I locked last month. They’re 45 days out from closing. They have been calling 100s of applications that’s in process to break the news to them that they’ll have to pay 0.5 fee.

LF said 0.5 fees are added already and nothing we can do about it.
Again, the 0.5% fee will not be itemized and nobody will know it is included unless they specifically ask (and, for the record, yes it is included - with no exceptions - for every refinance loan that will be sold [not closed, the sale to FNMA occurs after closing] to FNMA after September 1). It is rolled into the rate/credits offered as it is a back end adjustment.

Lenders are mad at FNMA because it was so short notice. If they sell a loan after 9/1, they have to pay this fee. This is a new precedent, since the GSE's have never done something like this with such short notice. Now lenders have to consider that the GSE's can change the rules going forward with no notice.
Regardless of itemization, the question is whether people who previously locked will now have to pay this additional fee if it was not previously included. From what the previous poster is saying, it sounds like Watermark is going to try to recoup this. I don't know what the basis would be since our rate locks indicate that the fees including points and lender credits cannot change.
Ryzen
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Re: Refinance Mega Thread

Post by Ryzen »

keystone wrote: Tue Aug 18, 2020 9:43 am
Ryzen wrote: Tue Aug 18, 2020 9:18 am
Familyman2012 wrote: Tue Aug 18, 2020 9:14 am I talked to both WM and LF yesterday. Both of them stated that the 0.5 fee is already added in the closing fees. I asked them to clarify what that exactly means.

WM said that even if I locked last month. They’re 45 days out from closing. They have been calling 100s of applications that’s in process to break the news to them that they’ll have to pay 0.5 fee.

LF said 0.5 fees are added already and nothing we can do about it.
Again, the 0.5% fee will not be itemized and nobody will know it is included unless they specifically ask (and, for the record, yes it is included - with no exceptions - for every refinance loan that will be sold [not closed, the sale to FNMA occurs after closing] to FNMA after September 1). It is rolled into the rate/credits offered as it is a back end adjustment.

Lenders are mad at FNMA because it was so short notice. If they sell a loan after 9/1, they have to pay this fee. This is a new precedent, since the GSE's have never done something like this with such short notice. Now lenders have to consider that the GSE's can change the rules going forward with no notice.
Regardless of itemization, the question is whether people who previously locked will now have to pay this additional fee if it was not previously included. From what the previous poster is saying, it sounds like Watermark is going to try to recoup this. I don't know what the basis would be since our rate locks indicate that the fees including points and lender credits cannot change.
I think it is a misunderstanding. If they are locked, I don't see what Watermark can do except bully customers into letting the lock expire? Regardless, people who aren't locked are going to pay.

These online lenders run on razor thin margins, they are taking a hit from this for sure.
FiscallyResponsible
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Joined: Mon Feb 22, 2016 9:02 pm

Re: Refinance Mega Thread

Post by FiscallyResponsible »

Just another AMEX datapoint... Closed July 30, received AMEX 2500 credit yesterday (August 17). <3weeks :D

Unforunately, it's been that long since I heard from Loan Cabin...
wootwoot
Posts: 577
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Re: Refinance Mega Thread

Post by wootwoot »

FiscallyResponsible wrote: Tue Aug 18, 2020 10:03 am Just another AMEX datapoint... Closed July 30, received AMEX 2500 credit yesterday (August 17). <3weeks :D

Unforunately, it's been that long since I heard from Loan Cabin...
Thx for the data point. I closed a week prior to you and haven't heard anything yet. Hoping for good news soon.
need403bhelp
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Re: Refinance Mega Thread

Post by need403bhelp »

BrandonBogle wrote: Tue Aug 18, 2020 8:21 am
need403bhelp wrote: Mon Aug 17, 2020 11:02 pm Thanks, so I locked my loan but I think I'm screwed if I understand better processing expert match datapoints correctly.

Looked up my loan processor on NMLS consumer access and they are not licensed in my state :(

In any case, I'll go ahead and send her the new LE tomorrow morning, but I'm guessing she just kicks it back to the concierge...

Do let me know if you have any tips please.

Thanks!
My processor was not licensed in my state either and had to involve my concierge to do the work. But it was no problem getting a second rate match (even when my concierge said I was at their “best” pricing). Somewhere upthread (at least I think it was this thread) I discussed how each person has access to their own slice of the pie of matching funds and their own slice of other pies for discounts. So you may end up just fine with this second match.
MrJedi wrote: Tue Aug 18, 2020 7:58 am
jimmyrules712 wrote: Tue Aug 18, 2020 7:52 am
need403bhelp wrote: Mon Aug 17, 2020 6:41 pm I'd really like to get a no-cost 2.375% if possible, rather than a 2.5% with a ton of lender credits.
This sentence doesn't make sense. Lender credits are what makes a given rate "no-cost". The only way you'll get a 2.375% for "no-cost" is with "a ton of lender credits".
They can maybe clarify but I read that as 2.375% no cost is preferred over 2.5% no cost + enough credits to result in effective "cashback".
+1, that’s how I read it as well.
Thanks for the helpful datapoint and your interpretation of my comment was correct.

FYI, my processor is out of the office for the day, so I'll have to email some other ones...
m7a8a6
Posts: 19
Joined: Mon Aug 17, 2020 8:25 pm

Re: Refinance Mega Thread

Post by m7a8a6 »

PharmerBrown wrote: Mon Aug 17, 2020 9:56 pm
m7a8a6 wrote: Mon Aug 17, 2020 8:38 pm Hello everyone. First post from a long time novice lurking and sucking up all the wisdom from everyone(thank you). I couldn’t help but finally create an account because I’m just failing at making progress on this one.

I’m surprised at how everyone is able to get such low interest rates. I’m not able to find any refinance offers with no cost..or even low cost for my refinance goals. Loan officers told me straight up there are no offerings that are going to be net low or no cost.

I have excellent credit (815+), steady FT employment, 250k/30 yr loan at 4.5% in NJ.

Better - 3.0% at 7k in closing
Aimloan - 3.0% at 5.5k in closing
LD - 3.0% at 5k in closing
Ran through credible, lending tree, rocket mortgage but all had high costs.

I’m definitely doing something wrong. What’s the best strategy to achieve getting lenders to offer no cost?
How much of those closing costs are going toward your escrow?
Hi,
I just realized I entered better.com number incorrectly.

Better - A+B+C - $4430, E - $340, F - $2236, G - $1448 - Total - $8454
Aimloan - A+B+C - $2712, E - $230, F - $308, G - $1925 - Total - $5175
LD - They only gave me an overall number of $5k over the phone. No breakdown.
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