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Old 01-15-2009, 08:30 AM
 
1,740 posts, read 5,746,446 times
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Quote:
Originally Posted by Dopo View Post
I got 700+ credit score and almost no debt
They said I could take a loan almost twice as much as I want to spend.
That is the situation I am in as well...which Is why I am getting 4.5% on my new mortgage...but my point is that they are being very cautious on values. Times have changed.
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Old 01-15-2009, 08:43 AM
 
Location: Charleston, SC
5,615 posts, read 14,794,627 times
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At what point is it worthwhile to refinance? I'm just over 6% and have about 15% in the house.
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Old 01-15-2009, 11:50 AM
 
1,740 posts, read 5,746,446 times
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The question is how long do you plan on being in the house. We are planning on being in ours long term. We are refinancing from a 5.75% to a 4.5% mortgage. Our plan is that we continue making our previous payment - which will help us pay the house off sooner. By doing that our break even point is a little over two years. If we don't do that our break even is right at four years. One big advantage is that it lowers your payment - which could come in handy in the event that you find yourself unemployed or being forced to take a pay cut - which may happen to lots of folks in the coming year.
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Old 01-15-2009, 11:53 AM
 
1,740 posts, read 5,746,446 times
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Quote:
Originally Posted by scuba steve View Post
At what point is it worthwhile to refinance? I'm just over 6% and have about 15% in the house.
Assuming you have good credit - you should be able to get 4.75% with that level of equity. Your payment would drop. Now - make sure you don't fall into the trap of getting another 30 year mortgage to replace your current 30 year mortgage. That may not help you out at all. For example - you should never refinance if you are just extending the date you pay your house off.

If you have been in your home for five years...look to get a 20 or 25 year mortgage - so that your maturity date remains the same. Most people don't think about that. They just refinance to get the lower rate while forgetting that they are extending the maturity.
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Old 01-15-2009, 11:53 AM
 
1,366 posts, read 4,488,647 times
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Quote:
Originally Posted by scuba steve View Post
At what point is it worthwhile to refinance? I'm just over 6% and have about 15% in the house.
i have always heard that unless you are dropping 1% or more, it's really not worth it to refi...
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Old 01-15-2009, 11:55 AM
 
1,740 posts, read 5,746,446 times
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Quote:
Originally Posted by mrstxcop View Post
i have always heard that unless you are dropping 1% or more, it's really not worth it to refi...
This is a good rule of thumb - especially now that most banks are no longer waiving fees like in the good ol days.
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Old 01-15-2009, 12:01 PM
 
298 posts, read 945,425 times
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What is a reasonable amount in fees that we can expect to pay if refinancing? We bought a home in June at 5.75% and have 20% equity with excellent credit.

Do you have to pay a 1% loan origination fee again?
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Old 01-15-2009, 01:31 PM
 
1,740 posts, read 5,746,446 times
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Quote:
Originally Posted by texasgirl1 View Post
What is a reasonable amount in fees that we can expect to pay if refinancing? We bought a home in June at 5.75% and have 20% equity with excellent credit.

Do you have to pay a 1% loan origination fee again?
Most likely. They call the fees different things - but you can expect to pay nearly the same closing costs again.
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