Anyone refinance lately with no/low closing costs- what bank?

[WeLuvDCL]

We want to refinance our home to put on an addition. We have great credit and the amount we want to refinance for a 15y loan is less than 60% of the value of our house. We have been with a credit union for over 15 years and always had our loans through them. However, they want over $4,000 in closing costs.

I see ads all the time for no or very low closing costs but I don't know which banks are the best. I checked www.bankrate.com and I've never heard of most of those banks. Is it really too good to be true and I should stick with my credit union?

There are 3 must-haves that we need for a mortgage..
1. No escrow account.
2. No early payment penalty.
3. Ability to do automatic payments with additional principle payment.

Anyone refinance with similar scenario and what bank? TIA.

 

[Gumbo4x4]

We did ours for ~$1,200 which included a new inspection/assessment, and nearly $300 in interest rolled into the loan since we were skipping a month of payments in the process. Went from a 25-year note at 4.875% to a 20-year note at 3.50%. We do not escrow. But, we've worked with this same bank many, many times and even after the housing crunch our home is worth 45% more than we owe.

 

[WeLuvDCL]

We did ours for ~$1,200 which included a new inspection/assessment, and nearly $300 in interest rolled into the loan since we were skipping a month of payments in the process. Went from a 25-year note at 4.875% to a 20-year note at 3.50%. We do not escrow. But, we've worked with this same bank many, many times and even after the housing crunch our home is worth 45% more than we owe.

What bank? Did you get the low closing because you have other accounts with them?

 

[karinbelle]

Have you tried your local credit union? Ours does a refinance for only the cost of the appraisal (about $400) and it is very competitive with rates.

 

[platamama]

I'm in the process of refinancing to a 15 yr mortgage myself. I liked checking the rates on zillow mortgage and found the lowest rates offered there, although there has been an uptick in rates in the past two weeks. Luckily we locked (2.875%) before it went up.

Anyway, check Zillow for a refinance. There are many reviews posted on each of the companies that show up when you fill in the different fields. I've never worked with this particular company before but they've been easy to deal with so far (knock on wood). It's called First Financial Services, Inc. in North Carolina, but since not all lenders work in all states you need to visit Zillow and see what pops up for you.

I'm not sure what you are counting on as fees. With no escrow you are automatically bumping your rate up 0.25% and with interest rates in the toilet I don't see any huge benefit of holding onto your money yourself until insurance and property taxes come due. I don't consider prepaids as fees anyway since you have to pay them in a few months anyway. With the company I used, their origination fee was $320, and I'm paying the appraisal and title and recording fees (all those nitty gritty 3rd party fees) which all together are about $2000 on a >$300K refi. I thought that was pretty good.

Good luck to you!

 

[Disneynut71]

Working for a credit union myself, I know there are lower cost options out there. If your credit union is that high...check at others. We have many options at our credit union with much lower costs.

Good Luck

 

[holden]

We did a refi through Wells Fargo (our old mortgage was with them too). It cost us nothing. I forget what it was called, but it was something like a "3 step" refi. Our new mortgage is 15 yrs (as was the old) and 1% lower interest rate than we were paying before. They sent us paperwork in the mail and all we had to do was sign. It was painless and is saving us $ in the long run.

There is no payment for paying it off early or for making extra principal payments (we just pay our old payment and the extra goes to principal). We do have an escrow acct., but I don't know if that was required.

I'm not sure if they are still offering this refi. They called us about it and we jumped on it.

 

[mistysue]

Want to add a little warning for you. This is a very specific issue, so I never thought to ask about it. I got my mortgage and learned early on that I could pay 1/4 of my payment every week- read an article that people who paid 2 half payments per month paid off their loan years faster. When I did this, it paid the interest to date and the rest to the principle. Once I paid it 4 times, it would count that as one payment. (so no matter how many little payments, once I hit the monthly amount it counted as a payment) Every week my interest due went down by 2 cents- so while it was very little, over the life of the loan I saved a little. When I pay it off I'll probably blow it on a mocha.

It was a balloon so after my 5 years I refinanced. I checked repeatedly that there were no early payment penalties or whatever. Now no matter how many payments I make during the month or when I make them, it does not apply my payment until the payment due date, and used the pre-calculated amount for interest. If I pay additional principle it recalculates once a month so the interest amounts adjust but if I pay 10 days early I don't save the penny that month or whatever it was. That is how they justify saying that there is no penalty, because if I make an extra payment it does recalculate the interest after a month... and the exact response I get from them is "well, it's such a small difference you would never know"
Little thing, but annoys the crap out of me. Over the 20 remaining years of the loan they will probably get an extra $10 out of me, but that is MY $10, not theirs.

So if your current loan applies the payment to the current interest due as of the date you pay it- you might want to check if that is about to change because some banks don't work that way.

 

[Gumbo4x4]

What bank? Did you get the low closing because you have other accounts with them?

Citizens Bank - it's pretty much local. We don't have any other accounts there, but they've financed many loans for us in the past 15+ years. www.citizensbankmo.com We go through the Washington, MO branch.

 

[hsmamato2]

we just closed on a refi took less than a month from 1st inquiry to signing we paid about 1700.00 for fees-
took our rate from 5.8 for the next 20 years to 3.25 for 15 years
When we tried to refi thru our old lender(wells fargo) they wanted to charge us more in fees...
oh, we did it at a local credit union-
BTW to the original question I don't think there is such thing as 'no fees',is there? Doesn't that mean they roll those fees into your loan,so you pay no matter what?

 

[stitchlovestink]

We did a refi through Wells Fargo (our old mortgage was with them too). It cost us nothing. I forget what it was called, but it was something like a "3 step" refi. Our new mortgage is 15 yrs (as was the old) and 1% lower interest rate than we were paying before. They sent us paperwork in the mail and all we had to do was sign. It was painless and is saving us $ in the long run.

There is no payment for paying it off early or for making extra principal payments (we just pay our old payment and the extra goes to principal). We do have an escrow acct., but I don't know if that was required.

I'm not sure if they are still offering this refi. They called us about it and we jumped on it.

Was it a HARP refi? Not saying you're not being truthful, but I suspect it just didn't cost you anything out of pocket. Banks have been calling their clients to refinance their loans but they are rolling costs into the new loans AND if they are Harp or other gov based refi's they are getting a kickback from the gov't for doing these too!

 

[Gumbo4x4]

Was it a HARP refi? Not saying you're not being truthful, but I suspect it just didn't cost you anything out of pocket. Banks have been calling their clients to refinance their loans but they are rolling costs into the new loans AND if they are Harp or other gov based refi's they are getting a kickback from the gov't for doing these too!

IIRC, a HARP refi only applies to Fannie Mae/Freddie Mac loans.

 

[stitchlovestink]

IIRC, a HARP refi only applies to Fannie Mae/Freddie Mac loans.

True! But do you realize many loans are Fannie Mae/Freddie Mac loans?
You may be surprised to find out that your loan is linked to them.
TONS of conventional loans with large lenders such as Chase, BB&T, Wells Fargo, etc are linked Fannie Mae & Freddie Mac and the Borrower has no idea!!!
I was one of them! So was my sister and 2 of my friends. I think you would be surprised at the number of people who don't know that their loan is linked to Fannie/Freddie. And I have a conventional not an FHA! All of us did! Now I would not know if a smaller bank or credit union works the same way but am being told consistently that the bigger lenders are pretty much all tied to Fannie & Freddie. I did see a bit ago though, that the gov't did come out with another program for the non-fannie & freddie loans too though....

 

[SaraJayne]

True! But do you realize many loans are Fannie Mae/Freddie Mac loans?
You may be surprised to find out that your loan is linked to them.
TONS of conventional loans with large lenders such as Chase, BB&T, Wells Fargo, etc are linked Fannie Mae & Freddie Mac and the Borrower has no idea!!!
I was one of them! So was my sister and 2 of my friends. I think you would be surprised at the number of people who don't know that their loan is linked to Fannie/Freddie. And I have a conventional not an FHA! All of us did! Now I would not know if a smaller bank or credit union works the same way but am being told consistently that the bigger lenders are pretty much all tied to Fannie & Freddie. I did see a bit ago though, that the gov't did come out with another program for the non-fannie & freddie loans too though....

We re-financed at the beginning of this year and were given the option of having our mortgage linked to Freddie Mae/Mac. I said absolutely not, we took the other choice.

OP, our re-fi had no closing costs, no escrow required, no prepayment penalty and even though our payments are automatic, we can apply any extra amount to the principle at any time.

Our bank is a regional bank (only in WI, IL and MN) and there were strict conditions that had to be met in order to do the no-cost re-fi. I don't think it's being offered any more.

 

[Gumbo4x4]

True! But do you realize many loans are Fannie Mae/Freddie Mac loans?
You may be surprised to find out that your loan is linked to them.
TONS of conventional loans with large lenders such as Chase, BB&T, Wells Fargo, etc are linked Fannie Mae & Freddie Mac and the Borrower has no idea!!!
I was one of them!

Funny that you mention that - our most recent refi was a few weeks ago & we got notice that we're now Fannie Mae

 

[loafer74]

We paid 550 out of pocket in Dec , 300 was for the appraisal , we got 3.75

 

[DawnM]

We used First Internet Bank and refinanced in October.

3.37% and all we paid was the appraisal.

 

[Gumbo4x4]

We used First Internet Bank and refinanced in October.

3.37% and all we paid was the appraisal.

Score!