Am I in a position to negotiate? 801 credit score cash out refinance

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McJammer
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Am I in a position to negotiate? 801 credit score cash out refinance

Post by McJammer »

Last night our home loan consultant e-mailed with a preliminary cash-out refinance estimated itemized fee worksheet. Turns out (as I suspected) hubby has collections on his credit report. Ugh. Good news is that my credit score is 801 and I qualify for the loan based on my salary alone.

It's likely we'll move forward with the cash-out refinance putting the mortgage and title in my name. Estimated home value of $700,000 (thanks, new Amazon HQ2), 20-year term, cash-out of $23K, new loan amount of $393,000, closing costs of $9,400, new interest rate of 3.00 down from our previous of 4.125, should I be pushing for a better deal?

She's a home loan consultant, with many home loan products at her fingertips. I'm inclined to move forward with her, based on already having all the documentation uploaded into her system, and needing the money for the new retaining wall, etc. sooner rather than later.

Thoughts and suggestions welcome!
mw1739
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by mw1739 »

Depends on the breakdown of the $9,400 in closing costs. Are you escrowing? If so how much of that is taxes and insurance?

I did a 20 year cash-out refi at 2.875% last month with about $1,500 in pure closing costs. Similar credit profile as yourself.
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McJammer
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by McJammer »

Thanks for the reply!

Lender is requiring an appraisal at $525 as part of closing costs. Final total for closing costs (including title and transfer charges) is $4,742.

Reserves and Prepaid Costs are below for a total of $4,751,00:
Items Required by Lender to be Paid in Advance:
Daily Interest 20 Days @ $32.3000 $646.00
Reserves Deposited with Lender
Hazard Insurance premium 6 Months @ $115.00 $690.00
Real Estate Taxes 5 Months @ $683.00 $3,415.00 ‐‐‐
Total Estimated Reserve/Prepaid Costs ‐‐‐ $4,751.00
Golf maniac
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by Golf maniac »

Going online at Aimloan and Lenderfi costs you nothing and takes about 5 minutes to complete without giving personal information. It is a no brainer to at least check these sites and see what they offer. If you want to do more you can check with local banks and credit unions. Just remember rates are based on location, LTV, credit score, and property. If you have over 20% in equity I would highly recommend not doing an escrow. You will pay a little more in fees but well worth it.
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galawdawg
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by galawdawg »

McJammer wrote: Sat Jun 20, 2020 9:59 am Last night our home loan consultant e-mailed with a preliminary cash-out refinance estimated itemized fee worksheet. Turns out (as I suspected) hubby has collections on his credit report. Ugh. Good news is that my credit score is 801 and I qualify for the loan based on my salary alone.

It's likely we'll move forward with the cash-out refinance putting the mortgage and title in my name...

Thoughts and suggestions welcome!
Assuming that the house is currently jointly owned, is there a reason that you will have the property re-titled into your name only? I'd recommend you and your husband consider the possible consequences of having the title only in your name before you sign on the dotted line.
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McJammer
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by McJammer »

Thanks so much golf maniac. I didn't realize no escrow was an option.
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McJammer
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by McJammer »

galawdawg wrote: Sat Jun 20, 2020 4:22 pm
McJammer wrote: Sat Jun 20, 2020 9:59 am Last night our home loan consultant e-mailed with a preliminary cash-out refinance estimated itemized fee worksheet. Turns out (as I suspected) hubby has collections on his credit report. Ugh. Good news is that my credit score is 801 and I qualify for the loan based on my salary alone.

It's likely we'll move forward with the cash-out refinance putting the mortgage and title in my name...

Thoughts and suggestions welcome!
Assuming that the house is currently jointly owned, is there a reason that you will have the property re-titled into your name only? I'd recommend you and your husband consider the possible consequences of having the title only in your name before you sign on the dotted line.
his credit score is really low - current mortgage loan consultant says they can't do it with both of our scores on the loan. what are the downsides?
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galawdawg
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by galawdawg »

McJammer wrote: Sat Jun 20, 2020 4:29 pm
galawdawg wrote: Sat Jun 20, 2020 4:22 pm
McJammer wrote: Sat Jun 20, 2020 9:59 am Last night our home loan consultant e-mailed with a preliminary cash-out refinance estimated itemized fee worksheet. Turns out (as I suspected) hubby has collections on his credit report. Ugh. Good news is that my credit score is 801 and I qualify for the loan based on my salary alone.

It's likely we'll move forward with the cash-out refinance putting the mortgage and title in my name...

Thoughts and suggestions welcome!
Assuming that the house is currently jointly owned, is there a reason that you will have the property re-titled into your name only? I'd recommend you and your husband consider the possible consequences of having the title only in your name before you sign on the dotted line.
his credit score is really low - current mortgage loan consultant says they can't do it with both of our scores on the loan. what are the downsides?
I understand that you want to refinance in your name only due to his credit issues, but if you and your husband are currently on the title of the house, why would the deed need to change with the refinance? Is that something the lender would require? Generally speaking, you can have a house titled jointly in the names of both spouses even if only one spouse is on the mortgage.
02nz
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by 02nz »

OP, to answer the question in the thread title: negotiation on a loan (like almost anything else) is very simple, just not easy - you need to find a better offer, then see if someone will beat that better offer, or if not, then you know that's the best offer available. The market is too fluid and too varied (geography, property type, credit profile, and many other factors) for anybody to be able to evaluate an offer precisely. As a ballpark, I think your offer is good, but hard to say anything more than that.
Big Dog
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by Big Dog »

mw1739 wrote: Sat Jun 20, 2020 10:30 am Depends on the breakdown of the $9,400 in closing costs. Are you escrowing? If so how much of that is taxes and insurance?

I did a 20 year cash-out refi at 2.875% last month with about $1,500 in pure closing costs. Similar credit profile as yourself.
Exactly. What is in the $9400? What is the APR?

Does your broker offer any so-called 'no-cost' refi's, i.e., perhaps a slightly higher rate but no points up front?

Have you rate-checked with any credit unions for which you might be able to join?

(And yes, forget the escrow. Absolutely no need.)
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McJammer
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by McJammer »

Thanks for all the replies! I really appreciate it.

here's the worksheet from the mortgage consultant:

Estimated Closing Costs
Items Payable in Connection with Loan
Application Fee $1,195.00
Validation Services Fee $110.00
Appraisal Fee $525.00
Credit Report $95.00

Title Charges
Lender’s Title Insurance $850.00
Settlement Fee $875.00
Closing Protection Letter $20.00

Government Recording and Transfer Charges
Recording Fees $77.00
City/County Tax/Stamps $250.00
State Tax/Stamps $745.00
Additional Settlement Charges ‐‐‐ 0
Estimated Total Closing Costs ‐‐‐ $4,742.00

Credit Or Charge For Interest Rate
Origination Credit % -$0.00
Origination Points % $0.00

Estimated Reserves / Prepaid Costs
Items Required by Lender to be Paid in Advance
Daily Interest 20 Days @ $32.3000 $646.00
Reserves Deposited with Lender
Hazard Insurance premium 6 Months @ $115.00
$690.00 Real Estate Taxes 5 Months @ $683.00
$3,415.00 ‐‐‐
Total Estimated Reserve/Prepaid Costs ‐‐‐ $4,751.00
michaeljc70
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by michaeljc70 »

I wonder how much of those fees the "consultant" gets. I would just shop around on my own. I have never paid an application fee let alone $1200.
Herekittykitty
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by Herekittykitty »

galawdawg wrote: Sat Jun 20, 2020 4:50 pm I understand that you want to refinance in your name only due to his credit issues, but if you and your husband are currently on the title of the house, why would the deed need to change with the refinance? Is that something the lender would require? Generally speaking, you can have a house titled jointly in the names of both spouses even if only one spouse is on the mortgage.
The husband has bad credit, which reflects not paying debts as agreed. Could any of his current or future bad debts result in a lien against the house if his name is on the deed? I don't know the answer (and look forward to learning.) If so, then it might make more sense to have only her name on the deed?

Then in the future should his credit score increase significantly and whatever causes of it being bad sustainably addressed, they could see about getting him on both the mortgage and the deed should they want to do that, which they well might unless there are reasons we don't know.
I don't know anything.
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galawdawg
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by galawdawg »

Herekittykitty wrote: Sat Jun 20, 2020 6:57 pm
galawdawg wrote: Sat Jun 20, 2020 4:50 pm I understand that you want to refinance in your name only due to his credit issues, but if you and your husband are currently on the title of the house, why would the deed need to change with the refinance? Is that something the lender would require? Generally speaking, you can have a house titled jointly in the names of both spouses even if only one spouse is on the mortgage.
The husband has bad credit, which reflects not paying debts as agreed. Could any of his current or future bad debts result in a lien against the house if his name is on the deed? I don't know the answer (and look forward to learning.) If so, then it might make more sense to have only her name on the deed?

Then in the future should his credit score increase significantly and whatever causes of it being bad sustainably addressed, they could see about getting him on both the mortgage and the deed should they want to do that, which they well might unless there are reasons we don't know.
Gifting his interest in the house to his wife to avoid paying his creditors or to protect assets from his creditors could be considering a fraudulent conveyance.
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galawdawg
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by galawdawg »

michaeljc70 wrote: Sat Jun 20, 2020 6:30 pm I wonder how much of those fees the "consultant" gets. I would just shop around on my own. I have never paid an application fee let alone $1200.
I agree. You would be well served to get some other quotes for your refinance. I'd recommend you get at least three quotes so you can compare what each lender is offering.
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8foot7
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by 8foot7 »

There is no reason to remove the non-mortgaging party from the deed.

My wife got the mortgage on our house solely in her name because at the time we got the mortgage I was self employed and it was easier to simply use her w2 regular profile to obtain the loan rather than jump through all of the hoops regarding my self employment.
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McJammer
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by McJammer »

galawdawg wrote: Sat Jun 20, 2020 7:43 pm
michaeljc70 wrote: Sat Jun 20, 2020 6:30 pm I wonder how much of those fees the "consultant" gets. I would just shop around on my own. I have never paid an application fee let alone $1200.
I agree. You would be well served to get some other quotes for your refinance. I'd recommend you get at least three quotes so you can compare what each lender is offering.
Thanks so much for the help everyone!
buhlaxtus
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by buhlaxtus »

Elephant in the room, you and husband are not on the same page financially. That could be trouble regardless of how you handle this refinance.
jharkin
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by jharkin »

I won’t go into the solo vs joint application issues, other have.


What I will say is that with an 800 credit score and an LTV under 60% those closing costs are ridiculous. I just got 3.125 zero cost with a single phone call to LenderFi.

Specifically the application fee is quite high. Ive had many loans with zero. The title and settlement fees are double what I have paid on a MUCH larger loan.

I’m surprised there are transfer taxes on a refi, but that’s something set by your state, so you are stuck there.

Also, getting a lender to waive escrow should be easily doable.


Seriously, call LenderFi and Aimloan and ask them for their best offers. You can do far better.
pb1996
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by pb1996 »

LoanDepot just meaningfully beat out aimloan and lenderfi for me. pretty easy to work with so far...
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by 4nursebee »

McJammer wrote: Sat Jun 20, 2020 9:59 am Last night our home loan consultant e-mailed with a preliminary cash-out refinance estimated itemized fee worksheet. Turns out (as I suspected) hubby has collections on his credit report. Ugh. Good news is that my credit score is 801 and I qualify for the loan based on my salary alone.

It's likely we'll move forward with the cash-out refinance putting the mortgage and title in my name. Estimated home value of $700,000 (thanks, new Amazon HQ2), 20-year term, cash-out of $23K, new loan amount of $393,000, closing costs of $9,400, new interest rate of 3.00 down from our previous of 4.125, should I be pushing for a better deal?

She's a home loan consultant, with many home loan products at her fingertips. I'm inclined to move forward with her, based on already having all the documentation uploaded into her system, and needing the money for the new retaining wall, etc. sooner rather than later.

Thoughts and suggestions welcome!

A few years ago as we were trying to line things up for retirement we pursued some sort of real estate financing deal, I forget the exact details, I think we were to change a HELOC 125K loan to a mortgage, lower payments. In many ways it really seemed like a good idea, would give us great peace of mind with lower monthly obligations. In the end we did not go through with it as the slippage or high fees involved just really seemed idiotic. I think I was not willing to give away $6,000 for the potential peace of mind.

For your details, all I needed to see that the cash out of $23,000 costs $9,400 which seems like a horrible deal.
Perhaps set up a spreadsheet (or back of napkin) analysis on how long the payback is for keeping your current mortgage versus the new deal.

801 credit score? Get a different loan product for the wall. Don't add so much to the cost.
Pale Blue Dot
reln
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by reln »

McJammer wrote: Sat Jun 20, 2020 9:59 am Last night our home loan consultant e-mailed with a preliminary cash-out refinance estimated itemized fee worksheet. Turns out (as I suspected) hubby has collections on his credit report. Ugh. Good news is that my credit score is 801 and I qualify for the loan based on my salary alone.

It's likely we'll move forward with the cash-out refinance putting the mortgage and title in my name. Estimated home value of $700,000 (thanks, new Amazon HQ2), 20-year term, cash-out of $23K, new loan amount of $393,000, closing costs of $9,400, new interest rate of 3.00 down from our previous of 4.125, should I be pushing for a better deal?

She's a home loan consultant, with many home loan products at her fingertips. I'm inclined to move forward with her, based on already having all the documentation uploaded into her system, and needing the money for the new retaining wall, etc. sooner rather than later.

Thoughts and suggestions welcome!
Closing costs seem expensive. Shop around. Focus on apr.
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McJammer
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by McJammer »

Thanks everyone, this is so helpful and I really appreciate it!

Our current mortgage is our first, and this is our first refinance. We need the cash for home repairs that should be done by fall. I'll be using some of our emergency fund but I want to keep most for . . . well emergencies. The first offer is from a lender who has pulled our credit - I also applied online with Provident Funding but haven't heard back (1.5 days - is that unusual? I don't like it). I'm uncomfortable having too many lenders pull our credit. I should be able to get a quote without actually applying yes?

Also I didn't see on LenderFi's web site any option to find rates specifically for a cash-out refi.
av111
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by av111 »

McJammer wrote: Sun Jun 21, 2020 2:35 pm
Our current mortgage is our first, and this is our first refinance. We need the cash for home repairs that should be done by fall.
Cash out rates are 0.25% higher. But costs should be similar. Get more quotes from different lenders

Would a straight refi and opening a heloc for the repair related expenses be cheaper
AV111
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McJammer
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by McJammer »

Those of you obtaining zero lender's fees . . . I'm wondering if you live in an area with a calmer real estate market. We live in Northern Virginia, right outside Washington, D.C, specifically in a hot, hot market. All quick quotes online from Lenderfi and Aimloan include lender's fees to go along with the 3.125% or 3.00% rate. Aimloan today is saying lender's fees of $1,363 for the 3.00% rate. The trade-off for us to receive lender's credits may be a rate of 3.125 or higher. We're at 4.125 now.
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galawdawg
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by galawdawg »

McJammer wrote: Sun Jun 21, 2020 2:35 pm Thanks everyone, this is so helpful and I really appreciate it!

The first offer is from a lender who has pulled our credit... I'm uncomfortable having too many lenders pull our credit...
FYI...

You can shop around for a mortgage and it will not hurt your credit...from the Consumer Financial Protection Bureau:
Within a 45-day window, multiple credit checks from mortgage lenders are recorded on your credit report as a single inquiry. This is because other creditors realize that you are only going to buy one home. You can shop around and get multiple preapprovals and official Loan Estimates. The impact on your credit is the same no matter how many lenders you consult, as long as the last credit check is within 45 days of the first credit check. Even if a lender needs to check your credit after the 45-day window is over, shopping around is usually still worth it. The impact of an additional inquiry is small, while shopping around for the best deal can save you a lot of money in the long run. Note: the 45-day rule applies only to credit checks from mortgage lenders or brokers. Credit card and other inquiries are processed separately.
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McJammer
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by McJammer »

galawdawg wrote: Sun Jun 21, 2020 3:34 pm
McJammer wrote: Sun Jun 21, 2020 2:35 pm Thanks everyone, this is so helpful and I really appreciate it!

The first offer is from a lender who has pulled our credit... I'm uncomfortable having too many lenders pull our credit...
FYI...

You can shop around for a mortgage and it will not hurt your credit...from the Consumer Financial Protection Bureau:
Within a 45-day window, multiple credit checks from mortgage lenders are recorded on your credit report as a single inquiry. This is because other creditors realize that you are only going to buy one home. You can shop around and get multiple preapprovals and official Loan Estimates. The impact on your credit is the same no matter how many lenders you consult, as long as the last credit check is within 45 days of the first credit check. Even if a lender needs to check your credit after the 45-day window is over, shopping around is usually still worth it. The impact of an additional inquiry is small, while shopping around for the best deal can save you a lot of money in the long run. Note: the 45-day rule applies only to credit checks from mortgage lenders or brokers. Credit card and other inquiries are processed separately.
Thanks galawdawg! I suspected so but thought it was 30 days.
Herekittykitty
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Re: Am I in a position to negotiate? 801 credit score cash out refinance

Post by Herekittykitty »

galawdawg wrote: Sat Jun 20, 2020 7:40 pm
Herekittykitty wrote: Sat Jun 20, 2020 6:57 pm
galawdawg wrote: Sat Jun 20, 2020 4:50 pm I understand that you want to refinance in your name only due to his credit issues, but if you and your husband are currently on the title of the house, why would the deed need to change with the refinance? Is that something the lender would require? Generally speaking, you can have a house titled jointly in the names of both spouses even if only one spouse is on the mortgage.
The husband has bad credit, which reflects not paying debts as agreed. Could any of his current or future bad debts result in a lien against the house if his name is on the deed? I don't know the answer (and look forward to learning.) If so, then it might make more sense to have only her name on the deed?

Then in the future should his credit score increase significantly and whatever causes of it being bad sustainably addressed, they could see about getting him on both the mortgage and the deed should they want to do that, which they well might unless there are reasons we don't know.
Gifting his interest in the house to his wife to avoid paying his creditors or to protect assets from his creditors could be considering a fraudulent conveyance.
Thanks for educating me on this. I wasn't thinking about it that way. It doesn't seem reasonable though for his debts that he may have brought into the marriage to put her equity in the house at risk especially if she owned the house before the marriage, that's what I was thinking about. (Maybe neither of those is the case, though, we don't know.) Anyway - that's why a person gets a legal opinion on this kind of thing! Thanks again.
I don't know anything.
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