To refi my 3.865 mortgage or not

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jenig0013
Posts: 31
Joined: Sat Aug 02, 2014 10:52 pm
Location: Central Florida

To refi my 3.865 mortgage or not

Post by jenig0013 »

Struggling with whether to refi or not.

Currently in a 30 yr fixed 3.865% mortgage. Considering a refi to 3% for either a 20 or 30yr. I don’t think we can quite swing a 15 yr payment. We have 340k remaining on our mortgage, and been in the house for about 2.5 yrs. Based on mortgage professor calculators, we would need to stay in the house 3-4 yrs for that to pay off. With the current economic climate, I’m just not sure I can guarantee that. Cash to refi seems about $6400 from my quotes.
Golf maniac
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Re: To refi my 3.865 mortgage or not

Post by Golf maniac »

If you are unsure you will stay that long then don’t do it. Look at a no cost mortgage and see if that will reduce your rate.
MrJedi
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Re: To refi my 3.865 mortgage or not

Post by MrJedi »

If your credit is ok you should be able to refi at no cost, lender credits cover all costs in sections A, B, C, and E. Be sure to ask for lender credits, not simply rolling costs into the loan. The credits will move your rate up a little bit, but rates are low enough right now that even with these credits you can get a better interest rate. This means you save money upon the first monthly installment.
regularguy455
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Re: To refi my 3.865 mortgage or not

Post by regularguy455 »

MrJedi wrote: Fri Aug 07, 2020 9:26 am If your credit is ok you should be able to refi at no cost, lender credits cover all costs in sections A, B, C, and E. Be sure to ask for lender credits, not simply rolling costs into the loan. The credits will move your rate up a little bit, but rates are low enough right now that even with these credits you can get a better interest rate. This means you save money upon the first monthly installment.
This is a good starting point. I would also price out rolling costs into the loan with a lower rate on the amortization schedule.
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Stinky
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Re: To refi my 3.865 mortgage or not

Post by Stinky »

jenig0013 wrote: Fri Aug 07, 2020 8:58 am Struggling with whether to refi or not.

Currently in a 30 yr fixed 3.865% mortgage. Considering a refi to 3% for either a 20 or 30yr. I don’t think we can quite swing a 15 yr payment. We have 340k remaining on our mortgage, and been in the house for about 2.5 yrs. Based on mortgage professor calculators, we would need to stay in the house 3-4 yrs for that to pay off. With the current economic climate, I’m just not sure I can guarantee that. Cash to refi seems about $6400 from my quotes.
Does the “cash to refi” include prepaids? If so, reduce the “cash to refi” by the amount of the prepaids.

Then see how long it will take to recover your net cash to refi from interest savings. (Interest savings in the first year would be about $2,900).

If it’s less than two years, I’d do this refi. Unless I could find a better deal elsewhere.
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finite_difference
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Re: To refi my 3.865 mortgage or not

Post by finite_difference »

Golf maniac wrote: Fri Aug 07, 2020 9:01 am If you are unsure you will stay that long then don’t do it. Look at a no cost mortgage and see if that will reduce your rate.
+1.

No cost mortgage.

Refinance to 30-year, lower your monthly payment, save on interest, and pay it off like a 15-year.

In the short term, you can also divert the savings to your emergency fund, or include a small cash-out, if you’re worried.

Check LoanDepot, Lenderfi, Better, Northpointe Bank, etc. See the mortgage refinance Megathread.
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Jmh04j
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Re: To refi my 3.865 mortgage or not

Post by Jmh04j »

I was in a similar situation earlier this year. I refinanced my 3.625% 30-year mortgage with a 2.99% 30-year fixed with no points. The payback was approximately 2 years. We decided to stay in the house so it made sense to do the refi. Rates are really good but just make sure to negotiate with the lenders to get the sub 3% rate with no points. I would recommend going with a direct lender as opposed to a broker etc. it is more work for you but it can get you a better rate.

Best of luck!
KATNYC
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Re: To refi my 3.865 mortgage or not

Post by KATNYC »

We are going through this right now. Rates came in for 30 year fixed at 2.875% with no points and 2.375% with a rate buydown.
We have a 10/1 ARM with 7 years left at 3.375% so there is no rush.
Topic Author
jenig0013
Posts: 31
Joined: Sat Aug 02, 2014 10:52 pm
Location: Central Florida

Re: To refi my 3.865 mortgage or not

Post by jenig0013 »

finite_difference wrote: Fri Aug 07, 2020 10:24 am
Golf maniac wrote: Fri Aug 07, 2020 9:01 am If you are unsure you will stay that long then don’t do it. Look at a no cost mortgage and see if that will reduce your rate.
+1.

No cost mortgage.

Refinance to 30-year, lower your monthly payment, save on interest, and pay it off like a 15-year.

In the short term, you can also divert the savings to your emergency fund, or include a small cash-out, if you’re worried.

Check LoanDepot, Lenderfi, Better, Northpointe Bank, etc. See the mortgage refinance Megathread.
Thanks so much, checking on this now.
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