Has anybody here refinanced the mortgage on their triangle area home recently?
Raleigh, Durham, Chapel Hill, CaryThe Triangle Area
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Correct. That long of a payback on investment isn't generally ever going to pan out based purely on the fact that people generally refinance their mortgages and/or move to new houses every 5-10 years. So you may think you're staying in a house for the long run, but and while that may be the case it's unlikely you'll hold that same mortgage the entire time you live in the house.
Since my current mortgage is with Wells Fargo, I just checked their rates for a 'no-cost' refi and their current rate is 5.85 %. I'm currently paying 6.25%. I got excited then I calculated the difference on a $170K loan and the difference is all of $44/month.
:-/
Not quite as exciting. I was hoping to see at least a $100/mo difference on a 'no-closing cost' refi.
Of course if I'm willing to do a regular loan and pay closing costs then my rate will be (perhaps much) less...at least 1/2 a point.
Since my current mortgage is with Wells Fargo, I just checked their rates for a 'no-cost' refi and their current rate is 5.85 %. I'm currently paying 6.25%. I got excited then I calculated the difference on a $170K loan and the difference is all of $44/month.
:-/
Not quite as exciting. I was hoping to see at least a $100/mo difference on a 'no-closing cost' refi.
Of course if I'm willing to do a regular loan and pay closing costs then my rate will be (perhaps much) less...at least 1/2 a point.
Still.....$44 bucks a month is $44 bucks a month. If your neightbor said they like you and decided to give you $44 bucks a month just because would you take it? Even though it may not be as much as you like it's still $528/year which might even cover your entire homeowners insurance costs.
Shop the rate, though, and call someone else.
Lastly, if you pay closing costs (and points) you might be able to chop off 1/2 point but probably not by paying closing costs alone. With my loan I would have only been able to drop the rate by 1/8 point if I paid closing costs.
Can't get anyone at Wells Fargo to talk to me for the next 24-48 hrs. And that 5.85 rate apparently does not count the 1 pt they add on (ahhh fine print). And the rates are moving up again, I hear.
Still, I'll shop around and do my homework. Sure, if I can get a break on my monthly payment at no cost then yes, it makes sense.
Hi,
Typically you should compare the GFE's and TIL's sent by various brokers and lenders.... Moderator cut: removed Closing costs vary as per different brokers and lenders.. But a good estimate would show u all possible closing costs involved.
Last edited by autumngal; 03-13-2008 at 04:52 PM..
Reason: to comply with the TOS
Can't get anyone at Wells Fargo to talk to me for the next 24-48 hrs. And that 5.85 rate apparently does not count the 1 pt they add on (ahhh fine print). And the rates are moving up again, I hear.
Still, I'll shop around and do my homework. Sure, if I can get a break on my monthly payment at no cost then yes, it makes sense.
I hate lenders that call a 1 point mortgage a "no cost" mortgage. A no cost mortgage should have no lender fees. Sometimes lenders even pay some 3rd party fees in this.
I saw the same thing with builder that were offering $1500 in "closing cost incentives" with their preferred lender but would then add 1 point and 1 orgination fee.... wiping out the savings. Always read the fine print!
That said, if you can get any savings on a true no cost loan its basically free money (minus the time it takes you to do the paperwork). The "1% lower" or "3-5 year" rule is a myth.... sometimes its less, sometimes more.
The true factor is to find out how long it will take you to break even on the refi (closing costs / monthly savings). If you will be staying in the home less time than that, do not refi (same applies to points or closing costs on a purchase). If you plan to be in the home longer than the time to break even then its something to consider.
The % change and time to beak even to make it worthwhile can vary greatly. Your loan amount, closing costs, tax bracket and other factors are also important. You need to weigh all your options and speak to a professional mortgage consultant or a financial planner if you need help.
We just locked in 5.25% 15-year fixed at State Employees Credit Union. Closing costs are about $1500, if I recall, but the amount of paperwork and hassle that we have had to do is minuscule. The keep the paper on their 15-year fixed loans. I could beat the rate, but the service and simplicity would be hard to top. Unless the rate drops again between now and then, we close on April 5.
We just locked in 5.25% 15-year fixed at State Employees Credit Union. Closing costs are about $1500, if I recall, but the amount of paperwork and hassle that we have had to do is minuscule. The keep the paper on their 15-year fixed loans. I could beat the rate, but the service and simplicity would be hard to top. Unless the rate drops again between now and then, we close on April 5.
When clients tell me they are members of SECU.... I usually tell them to go get a quote there. If they have decent credit and income SECU will get them the best mix of rate/terms/service and is an excellent value. Not everyone qualifies, but if you do SECU is a great choice.
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