Can I get my bank to give a better rate w/out refi? (loan, fixed rate)

[tamcim72]

Currently have about $182k balance on 2006 mortgage. My current loan is thru Countrywide-now Bank of America at 6.75%. I took a 10yr ARM, 30 yr Interest only loan. Reason being I didn't sell my old house in time for the closing so I had to take full mortgage on new house $400k and then eventually rolled over the profits into my current house. I felt this was my only option so that my monthly mortgage payment would adjust after the rollover. I amoritized the loan and have been paying principal reduction though. Even with the housing crisis I believe I still have atleast 80% equity. Hubby and I have great credit ratings.

I have contacted BofA and few other places to refinance (would have to put closing costs back into mortgage as currently unemployed and don't wont to use savings). I'm getting great rate offers of 4.875/1 point BUT closing costs are $8000+ and I don't feel comfortable going down to 20 or 15 yrs but no one wants to do 27 or 25. So to refinance I'll have to take a $8000 hit and take 3 steps (years) backward and start over at 30yrs.

Is there a way I can convince BofA to just lower my rate and take off the ARM w/o refi? I have always payed on time, above my normal payment.

[chet everett]

Although I am not a fan of spam (and know that City Data has a policy against it) the truth the OP really ought to pursue a loan modification / recast with the lender.

My experience with BofA, from their take over of other banks, is not good, so I do not know how they respond to such requests, but the reality is that it IS in their best interest to help you out some how.

The ARM ought to be easier for them to recast, as many lenders have different standard for ARMs than fixed rate mortgages (this has to do with the fact that a fixed rate mortgage is easier to sell on the secondary market as the servicing of it is MUCH simpler than an ARM).

If you truly have built up equity to over 80% of the market value of your home you have AN AWFUL lot to lose, and perhaps the lender may use this against you, as that would suggest that you do not owe more than the house could be sold for.

PLEASE do all your homework. Determine your total equity and the target rate / payment that you need to stay afloat. Don't trust anyone!

[VictorBurek]

You say that you are unemployed. do you have a spouse that works or are you receiving income from other areas.

If you are unemployed with no spousal income, you will not be able to refinance or do a loan modification. They will both require that you have a job and be able to show income.

Also, 8k in closing costs seems incredibly high unless your fico score is under 740.