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I live in Northern Virginia and I'm looking to refinance our home using the make homes affordable plan. My neighbor with a similar home and situation to ours (underwater) just set things into motion today to refinance their home loan through Bank of America. Our home loan is also through BOA. Assuming our neighbor has excellent credit, he locked in for 5.0% which I'm thinking is high?? Or is that the best one can hope for with this sort of plan? Our home loan is 5.5% and our neighbor's loan was 5.7%. Should I be looking elsewhere other than BOA to do this sort of refinance? We have no problems paying our current mortgage, but we are underwater (our ltv should be right around the 105% mark) and would like something in return for never missing a payment.
Yes, 5% is higher than market, but here's the deal without mincing words - Bank of America is the only one that will touch your loans. So, you're both kind of stuck. That said, you won't get the same rate with every channel within B of A. It's kind of hard to tip-toe through their mammoth set-up. You have the 800# (loan-line), you have the bank branches and you have the mortgage offices. Don't expect anything to move faster than molasses. But the good news is, once you lock, they'll lock you for 90 days (because they know they are slow). I left BofA because they just move slower than slow and most of my referral sources are real estate transactions with a deadline, not refinance related.
You don't say who your friend went through, but this is what I would do. I would contact a BofA mortgage loan officer (from their mortgage division, not bank branch). I ask them to give you an idea what the rate would be if you decided to go for the HAFA now (don't sound urgent like you need this now). Get a quote from the mortgage office - tell them you got a better quote from the 800# last week when the rates were lower. (give them 1/8% in rate lower) They should match if it's within range of their authority). Now if you start w/ the 800#, you may be locked into that channel, depending upon how much info you gave them (is there enough for them to consider it a full application - Address, loan program, income info, identity info).
Finally, chances are your friend locked in a while back and rates are lower (maybe much lower) than they were a couple weeks ago. Don't delay. BofA is famous for taking their rates up when business starts rolling in. DM me if you want direct numbers to a mortgage loan officer.......I have a friend there that thrives on the bank environment (as opposed to the real estate environment). Most people wind up gong with the 800# just because they need immediate gratification of an answered call and not voicemail. It's not always the better rate.
If you BOA loan is owned by Fannie or Freddie any mortgage broker can refinance your loan. You do not have to stay with BOA under Home Affordable Refinance Program. HARP allows you to competative rates and higher than otherwise allowable loan to values.
I have done many loans with BOA through the years when they were still working with brokers- had a BOA loan myself up to last year.
I was refinancing my own loan last year under HARP- no one is immune to value drops- BOA was my lender at the time and 5/3 is now. In the middle of the proccess we get a call from a BOA asking us to we want to speak to a loan officer about refinancing. I say absolutely being that I am curious what calls are going out to my clients. At this time I am using Freddie Mac open access- open access to any lender- under HARP program to refinance with 5/3 from BOA and I have locked in my rate in the low 4's. This LO from BOA gets on the phone telling me he is the only one in the world who can refinance me because only your crurent lender can use this program his rate is 5 plus closing costs are higher than what is standard and customary in our market.
Just because BOA says it doesn't mean its true- get a referral to a broker and have them evaluate where you are and what is available to you.
It depends on the LTV on if others will do the loan.
Check the transfer tax closely. By changing lenders, that's a big number. If you stay with the same lender, there's no transfer tax. Also, BofA will let you transfer escrows and in many cases won't require an appraisal.
I don't know if it's worth us going thru the process to get a .5 drop in our home loan, if the closing costs are expensive and we'd have to roll them into the loan as I don't want to put up the cash to do so. I'd be happier with something in the 4 something range as an interest rate (who wouldn't).
I'm just concerned that BOA is too high when I can do better elsewhere. Transfer tax.... what kind of numbers are we talking about? Is that something that can be rolled into a loan?
Will gladly take any direct numbers to loan officers.
I looked up transfer tax online. According to the website, it says Virginia transfer tax is only .1%. So approximately $380 if I go with a different lender. Or am I not understanding what a transfer tax is?
I just ran a 100K old loan/105K new loan scenario. Your mileage would vary. If you stayed at the same lender the xfer tax is $16. If you go elsewhere, it's $350. Not much, I know. But going elsewhere won't permit you to transfer the escrow balances, so you would have to re-establish. I would talk to both, someone at BofA and elsewhere.
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