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Old 12-28-2010, 08:28 AM
 
1,260 posts, read 2,155,456 times
Reputation: 373

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Hello everyone and happy holidays.

I use this forum to help purchase my mortgage in June 2008. Now I want to know if I can refinance for a lower interest rate. Here are the details:

Loan Date: June 2008
Original loan amount: 157,7533.00
Principal balance: 152,973.51
30 year fixed interest rate: 6.125%
2010 Appraised Value: 161,860

My credit score is good. My only loan debt is student loan and mortgage. Please let me know if more information is needed to determine if I can refinance for a lower interest rate.

Thanks in advance.
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Old 12-28-2010, 08:53 AM
 
49,049 posts, read 39,492,599 times
Reputation: 30676
Quote:
Originally Posted by darrell2525 View Post
Hello everyone and happy holidays.

I use this forum to help purchase my mortgage in June 2008. Now I want to know if I can refinance for a lower interest rate. Here are the details:

Loan Date: June 2008
Original loan amount: 157,7533.00
Principal balance: 152,973.51
30 year fixed interest rate: 6.125%
2010 Appraised Value: 161,860

My credit score is good. My only loan debt is student loan and mortgage. Please let me know if more information is needed to determine if I can refinance for a lower interest rate.

Thanks in advance.
If you plan on being in the house for a long time then yes.

Call your CURRENT mortgage holder and talk to them about it and see what deal they will give you.

I did one a number of years ago and they gave me a "no fee" refinance with minimal paperwork for a slightly higher interest rate than I could get with other mortgage providers.

If you can get say....4.25% on a 30 fixed your mortgage will drop by $175/mo but if you are itemizing on your taxes you will lose about $50 worth of tax dedcutions.

So, if it costs you $3,000 to refinance it will take you 3000/125 = 2 years to break even.
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Old 12-28-2010, 09:07 AM
 
Location: NJ
17,579 posts, read 38,383,508 times
Reputation: 16101
I don't think anyone is getting a rate of 4.25 these days without paying a lot in points.
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Old 12-28-2010, 09:21 AM
 
1,260 posts, read 2,155,456 times
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Quote:
Originally Posted by Mathguy View Post
If you plan on being in the house for a long time then yes.

Call your CURRENT mortgage holder and talk to them about it and see what deal they will give you.

I did one a number of years ago and they gave me a "no fee" refinance with minimal paperwork for a slightly higher interest rate than I could get with other mortgage providers.

If you can get say....4.25% on a 30 fixed your mortgage will drop by $175/mo but if you are itemizing on your taxes you will lose about $50 worth of tax dedcutions.

So, if it costs you $3,000 to refinance it will take you 3000/125 = 2 years to break even.
Thanks for that input. yes, i plan on staying the house for a long time.

I wanted the lender to roll the cost of refiance into the loan if thats possible. I didnt want to pay any upfront cost.
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Old 12-28-2010, 02:41 PM
 
Location: Laguna Niguel, CA
768 posts, read 3,963,564 times
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What was the appraisal for that you got this year? Are you in an FHA or VA loan now, or conventional?
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Old 12-29-2010, 08:17 AM
 
1,260 posts, read 2,155,456 times
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Quote:
Originally Posted by ShanetheMortgageMan View Post
What was the appraisal for that you got this year? Are you in an FHA or VA loan now, or conventional?
Thanks. The 2010 Appraised Value: $161,860. I have a FHA loan.

Again,thanks
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Old 12-29-2010, 10:46 AM
 
49,049 posts, read 39,492,599 times
Reputation: 30676
Quote:
Originally Posted by manderly6 View Post
I don't think anyone is getting a rate of 4.25 these days without paying a lot in points.
It was (obvious to most) meant as an example to show the payback period net of tax ramifications.

If you want to contribute content instead of just pot-shotting then please do so.
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Old 12-29-2010, 10:49 AM
 
49,049 posts, read 39,492,599 times
Reputation: 30676
Quote:
Originally Posted by darrell2525 View Post
Thanks for that input. yes, i plan on staying the house for a long time.

I wanted the lender to roll the cost of refiance into the loan if thats possible. I didnt want to pay any upfront cost.
I wasn't talking about rolling the refi cost into the loan, I was talking about seeing if you can get some sort of express refi where there are few if any costs but *maybe* pay a little higher interest rate.

They might not even be offering such a thing but thought it worth mentioning.

Ultimately you will get your available options and then sort through which ones make the most sense.

Might want to consider a 20yr. mortgage too which would keep your payment about the same (perhaps) and get you done with the loan faster.
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Old 12-29-2010, 11:59 AM
 
Location: Laguna Niguel, CA
768 posts, read 3,963,564 times
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Quote:
Originally Posted by darrell2525 View Post
Thanks. The 2010 Appraised Value: $161,860. I have a FHA loan.

Again,thanks
I was asking what was the reason for the appraisal this year. Seems odd you got an appraisal, as most homeowners just don't go out spending $300-400 on an appraisal, and equally as odd is the appraised value of $161,860... most appraised values are rounded to the nearest $1k, or $500.

Are you sure this wasn't a tax assessment? Tax assessments are not appraisals, and may not even be truly indicative of your home's value, as they can lag by 12-24 months. Just an FYI.

However since you have an FHA loan, even if you owe more than what your home is worth, you would still have the option of doing a streamline refinance without using the current value (no appraisal streamline refinance). If you get an appraisal, you can include the new loans closing costs into the new mortgage amount (up to 97.15% of the appraised value)... but with the no appraisal option you have to pay your closing costs out of pocket.

There are "no cost" refinances but the lower your loan amount, the higher the rate will be, because the costs are covered by generating extra profit, and larger loan amounts make more profit, so the rate doesn't have to increase as much as if it were a smaller loan amount. $150k is typically around the cutoff most lenders have for being able to do a no cost refinance.
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Old 12-29-2010, 12:37 PM
 
1,260 posts, read 2,155,456 times
Reputation: 373
Quote:
Originally Posted by ShanetheMortgageMan View Post
I was asking what was the reason for the appraisal this year. Seems odd you got an appraisal, as most homeowners just don't go out spending $300-400 on an appraisal, and equally as odd is the appraised value of $161,860... most appraised values are rounded to the nearest $1k, or $500.

Are you sure this wasn't a tax assessment? Tax assessments are not appraisals, and may not even be truly indicative of your home's value, as they can lag by 12-24 months. Just an FYI.

However since you have an FHA loan, even if you owe more than what your home is worth, you would still have the option of doing a streamline refinance without using the current value (no appraisal streamline refinance). If you get an appraisal, you can include the new loans closing costs into the new mortgage amount (up to 97.15% of the appraised value)... but with the no appraisal option you have to pay your closing costs out of pocket.

There are "no cost" refinances but the lower your loan amount, the higher the rate will be, because the costs are covered by generating extra profit, and larger loan amounts make more profit, so the rate doesn't have to increase as much as if it were a smaller loan amount. $150k is typically around the cutoff most lenders have for being able to do a no cost refinance.
Thanks Shane. I got the appraisal value from the 2010 Tax Statment. Where do I find the appraisal value from? Is there a website?

I will call my mortage loan bank (Chase) and ask what refinance options do I have. I wasnt sure if I was able to refinance due to I only been in the house for 2.6 years.
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