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when someone puts 20% down....i doubt they have a prepayment penalty.
She would have been REALLY taken advantage of if she has one.
Credit inquiries count as 1 credit pull if all done within 30days.
1 credit inquiry can drop your score btwn 3-7 points ...depending on how many pulls you had lately. 3-7 points hardly makes or break a deal.
80% LTV will always give you the best interest rate.....even if your score is 620. (with no MAJOR derogatory)
I'm not sure what mortgage broker would say to pay 6.75% for a few months or yrs to 'season' your mortgage. That's throwing money away just because of 'seasoning'.
Building up equity wont affect the interest rate....when you're at 80 LTV..you will get the same rate as if you had 70% LTV.
Not sure where you have been hearing this from....
My recommendation is to start working with your current lender. Ask for a quote....you should get 30yr fixed 5.625% with today's rate. Second...find the attorney who did your closing...they will most likely offer discount rates for the closing fees and title insurance fees.
If your current lender isnt willing to offer the rate...the start shopping....but try to negotiate with the attorney for lower title costs.
The costs that I showed before is what normally a lender will charge.
After finding out the facts then make a decision to wait or to move forward.
One thing I always tell a customer is find out what it takes to be in the position of 'locking' an interest rate.
For example...your current lender may say the rate dropped to 5% but you cant lock because you need to provide w-2's, paystubs, etc...and also need an appraisal done, and the Underwriter will need to approve your loan...ETC. Then you will need to wait 3-4 days..and the rates may change at that point.
1. Rates change daily or hourly (depending on market)
2. Every lender may have a different lock policy. Some may require an appraisal done...some may not. Some may require you to be approved ...some may not.
3. Shop around....find out who's willing to win your business. You may find a broker who will be willing to cut costs just to fund an extra loan.
I'd look and see if I could refinance with a 15 year mortgage at a lower rate. Your payment might be close to what you're paying now, but you'll have a heck of a lot more equity when you sell in five years.
Yes rates have dropped yet again. I don't know who you have a mortgage with but before you consider refinancing consider the following:
Do you have a prepayment penalty? What is the percentage?
NC allows Co's to charge prepayment penalties, for mortgages above $150,000.
Do you know what the closing costs will be if you do refinance? Is is worth it?
Then there are all those credit inquiries, which will reduce your credit score?
I don't know what to tell you, but from talking to mortgage brokers lately, I'd stay put, let your mortgage "season", build up some equity, then pursue. But then again that's just from what i have been hearing, best to talk to your mortgage co., and see if they have options that won't cost you an arm and a leg, which I doubt they won't. Consider ourselves lucky you got a mortgage and congrats.
It certainly is not so bad that someone with 20% down should consider themselves lucky that they were approved for a mortgage. Low to no money down loans are still readily available for loan amounts up to $417k.
Another mis-conception is the drop in credit score for an inquiry. If you apply for a refinance the inquiry will do little to nothing to your credit score.
Forget about the suggestion to wait for rates to drop another .5 to 1%... that's absurd and it won't happen.
it's all about Break even. I'd say you probably should at least apply for a refi and get firm numbers to look at. Pay special attention to the fees and figure out how long it will take toe recoup them.
Thanks for the figures. Looks like our new mortgage payment would be about $150 less per month and it would take about 24 months to break even after paying the closing costs. So, if we did stay in our home 5+ years, I guess it would be worth it.
We had an appraisal done just over 2 1/2 months ago - is there any chance a new lender might considering using that?
just a side note.. that $3500 fee you'll have to pay.. remember that i'll actually increase the balance of your mortgage.. so you would have to amoritize that over the life of the loan.. Yeah, I know.. its like $20 a month, but just dont forget that its a fee that your borrowing.
I've seen to many people refinance several times, and watched their loan balances become excessive over this fee. You seem to be in a good position not to worry about it.. but its just a comment.
They raised the costs by 0.25%. It should start in March...but all the lenders have already been raising their rates due to this.
The average increase I have seen has been by 0.5%
Rates were about 5.5% for 30yr fixed..and now have jumped to approx 6%
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