Help to Refinance Mortgage

[jmkst58]

I need to know who to go and talk to- that I would trust- about refinancing a mortgage. We're not sure it makes the most sense of course. For whatever reason- my husband & I (both computer analysts)- just really have no financial sense or talents whatsoever. So clueless. Sometimes I think my brain even shuts down and stops hearing (involuntarily) when people start throwing out figures and percentages.

I'd really love to sit down with someone- show them what our current mortgage (and home equity loan) are- and see if refinancing makes sense for us.

#1- we're happy with our payments. I don't think our interest rates are bad. I just know they are EVEN BETTER right now. And I'd like to shorten from a 30 year to a 15 year. I know we'd have to pay all the fees of refinancing and I'm not sure I'm the one who should be running these numbers and figuring out whether it would be worth it for us. lol. I never trust my instincts about financial decisions. No one else should be either. Just saying.

If we met with someone at our bank- could we really trust that they would steer us in the right direction? I'm the one who walks on a car lot and the salesman sees me coming- completely takes advantage of me- and I walk away kicking myself. lol. so i'm just kind of tempted to leave them as they are and don't mess with them. if I don't understand how to make them better- then just leave them alone. lol


Help? lol. We pay our bills just fine. We earn good income. I just need to know who to talk to, to ask whether it makes sense for us to re-do our mortgage right now.

TIA!

 

[Gr8t Fan]

There are several online calculators which can help to determine the costs associated with a refinance. www.mortgage.com and www.wellsfargo.com come immediately to mind. I'd do some research online first to determine what rates are being offered, get an idea of closing costs, etc. and then go to your current mortgage-holder and ask them for their best rate on a refinance (making sure to mention that you want to consolidate the home equity loan into the mortgage) including all closing costs. Once you have their bottom line estimate of closing costs and rate, I'd shop around with other lenders to see what they have to offer.

 

[Speed Weasel]

Dave Ramsey always recommends Churchill mortgage. http://www.churchillmortgage.com/Default.aspx

We used USAA (Churchill didn't play in Texas).

 

[scrapquitler]

Do you have a person who prepares your taxes, or some other person who helps with you financial types stuff (my Dad used to have an insurance agent/friend who helped him with this type of stuff)? For example if you have a CPA do your taxes, maybe he would sit down and give you some impartial advice (even for an hourly fee, it would be worthwhile).

Barring that, a relative who you trust who is savvy about these sorts of things maybe could give you some unbiased help understanding your options.

 

[mrsklamc]

Call a local credit union. Churchill was very nice to us, but there to make money- a credit union is there to help you!

 

[cari12]

We always use a mortgage broker. The company I use here in Canada is Invis but you could look in the Yellow Pages to find a broker in your area.
They will look at your situation, can crunch the numbers for you and find a mortgage company that fits what you want and need. They are paid by the mortgage companies so it does not cost you a thing and they can usually get better interest rates than you can on your own (even from your own bank!).

 

[Cheshire Figment]

Several critical questions.

What is your current rate?
What rate are you looking at?
How many years into your 30 year mortgage are you?
How long do you expect to remain in that house?
How much difference will there be in your monthly payment between your current 30 year and a new 15 yeaar?

And I would not go to a broker; If you are dealing through a broker they will get a commission whoich either will be a direct cahrge hidden in the closing costs or, even worse, by a slightly higher interest rate over the length of the loan.

Your best bet is to actually talk to the person who holds your mortgage; they don't want to lose you as you are a steady stream of income.

 

[cari12]

And I would not go to a broker; If you are dealing through a broker they will get a commission whoich either will be a direct cahrge hidden in the closing costs or, even worse, by a slightly higher interest rate over the length of the loan.

This has not been my experience at all! Your interest rate is set up front (currently we have prime -0.75%) and there are no commissions added on. The brokers are paid by the lenders (mortgage companies), not the borrowers.

 

[Speed Weasel]

Several critical questions.
Your best bet is to actually talk to the person who holds your mortgage; they don't want to lose you as you are a steady stream of income.

Yeah, [sarcasm]Chase was REAL excited to sit down and talk about refinancing the existing mortgage we had with them![/sarcasm] After demanding hundreds of dollars upfront in 'application' fees and every other made up fee that they could dream up, and then coming back with rates that were not even competitive in the market? They were told to pound sand and they did not even try to stop us from going elsewhere, so your statement, while sounding logical, is very much, Your Mileage May Vary.

 

[Miss SD]

Yeah, [sarcasm]Chase was REAL excited to sit down and talk about refinancing the existing mortgage we had with them![/sarcasm] After demanding hundreds of dollars upfront in 'application' fees and every other made up fee that they could dream up, and then coming back with rates that were not even competitive in the market? They were told to pound sand and they did not even try to stop us from going elsewhere, so your statement, while sounding logical, is very much, Your Mileage May Vary.

That's not always true. I read on another budget board thread that Wells Fargo was contacting clients and offering them no-fee refinancing to a lower rate. I called them, told them I wanted the same deal and they gave it to me.

I also spoke to a Churchill Mortgage affiliate company. The guy was really nice, but we both agreed that the $3,000 to $4,000 they'd probably charge me in fees wasn't worth it if I'd only save $80 a month. That's a pretty long break-even.

 

[beansmom]

all I know is DO NOT go to Bank of America...we started a home mortgage with them on May 22 of this year and we STILL don't hve a close. We have had several officers at BOA tell us that they don't handle their mortgages in a timely manner and they 'drop the ball' on loans. Even our architect said they are the WORST for mortgages. One officer told me he had a mortgage on his day that had taken over 200 days and still wasn't closed.

I understand they're on Dave Ramsey's 'bad' list also.

 

[beansmom]

and if you don't believe me, check out www.bankofamericasucks.com ...yeah, somebody beat me to it.

 

[DISdreamin']

Personally, if you're happy with who you deal with now, I'd contact your current mortgage lender. We did this, and ended up doing a refi over the summer. We didn't hit the bottom of the rate barrel obviously, but it was low enough that we were really happy with it. Our payments did go up ~$50 per biweekly payment, but the term went from 5 years into a 30 (paid biweekly so truly ~24 years originally to pay off) to a 15 year biweekly (which will be done in just over 12 years, I think). Not too bad, IMHO.

Much like it sounds you are considering doing, we only cared about getting the house paid off sooner, not about lowering payments. We shopped our credit union and the local bank who held our mortgage and the local bank gave us a better deal (~0.25% better, actually). We also looked around on the web and the rate we were offered seemed competitive with what was out there, but since we knew the bank and were comfortable with it, that made all the difference. They simply don't sell their mortgages, so we anticipate we'll be with them until this sucker is paid off.

 

[Swimalie]

The rule of thumb that Clark Howard http://clarkhoward.com/ says to go by and what we have used for any refinancing is you need to drop at least 1 percentage point and be able to pay off the cost of the refinancing within 2 years.

I like the idea of contacting your current lender and asking if they will give you a lower rate. We are in the process of refinancing and contacted our lender (who our mortgage was sold to) and they wouldn't do anything for us so we went shopping around and found a rate that was 1.375 lower and in our case, since we know we won't be staying in this house a minute longer than we have to, we are rolling the costs into the loan. Our out-of-pocket costs were only $18 for the credit reports and $450 for the appraisal. We will save $290 a month once we close in a few days. We're like you in that we are happy with our payment now but it's nice to save the money.

 

[twy715]

Fifth Third bank has a $299 refinance special going on right now. We just used them and there were no hidden fees. Info is on their website.

 

[mrsklamc]

I would not go near 5/3 with a ten foot pole.

Our refi through through our credit union was completely free- they paid the appraisal fee and there were no closing costs.

 

[Debbie7452]

I did one of those online things where lenders "compete" for your business. I wanted to get a comparison of the rates and fees from several sources. Well...it turned out that they were DESPERATE for business and I had to field a lot of very aggressive salespeople. I mean they would call and call.

However, I took a liking to one of the companies and we got our refi done through WCS lending (a broker). It was really a good experience. My guy at WCS was great at keeping me informed throughout the process. I saw afterward he got paid by the lender (CitiMorgtgage). They were so thrilled to get a customer that had equity and good credit. We shortened our loan by 10 years and are saving like $200,000 in interest, unbelievable! AND our payment went down slightly!

SO, go for it

 

[ICF]

Fifth Third bank has a $299 refinance special going on right now. We just used them and there were no hidden fees. Info is on their website.

We were going to go with 5/3 when we re-did ours last month, but I found another local bank (Union Savings) that had comparable closing costs (maybe $50 more) but their rate was less.

We ended up getting a 4 3/8% with about $325-$350 in closing costs on a 20 year mortgage.

 

[Arielle22]

all I know is DO NOT go to Bank of America...we started a home mortgage with them on May 22 of this year and we STILL don't hve a close. We have had several officers at BOA tell us that they don't handle their mortgages in a timely manner and they 'drop the ball' on loans. Even our architect said they are the WORST for mortgages. One officer told me he had a mortgage on his day that had taken over 200 days and still wasn't closed.

I understand they're on Dave Ramsey's 'bad' list also.

I have my mortgage with BOA. I remortgaged in May and it took only 21 days from start to finish. I was able to lower my rate and drop my mortage to 15 years.

Maybe it depends on the part of the country or who you are dealing with.

 

[Kim♥DISNEY]

We just refinanced in September. We only had 5 years left on a 10 year mortgage, however, we had a home equity loan that road .5% above prime rate. We wanted to roll that loan into something fixed since the rates were so low ... yet we were SO leery since we only had 5 years on our mortgage and the interest payments go down the closer you are to paying off the loan.

I did some research on the Boglehead forum and found this site they recommended:

http://www.mtgprofessor.com/home.aspx

It gives you calculators to compare mortgages, rates, etc. to see if refinancing is in your best interest.

We also went to a few website agencies to have them give us comparisons ... and they are like wolves!

We ended up using a company that was local called Victorian Finance. (We live outside Pgh, PA) One of the main reasons we went with this company is that they provided us with a HUD- Good Faith Estimate Form. As of January, lenders are "suppose" to provide you with this form so that you can compare offers. You would NOT believe how the online lenders AVOIDED this form! The reason they do is because it is a BINDING agreement that they are disclosing their fees when they offer you the loan. Many of the lenders provided us a GFE that was not on this form (this makes if very hard for borrowers to see the "real" fees). When we did get this official form (from very few lenders) we were astonished at how they were placing their fees into our loan.

I hope this helps. We got 3.75 for 15 years and were thrilled with the professionalism of Victorian Finance.

Also, we did contact our bank to see if they would lower our rate ... they offered us a small deal ... but it was not even close to what we got from other lenders.