Low mortgage rate anyone refinancing?

[dreamin_disney]

Dh and I were talking the other day about how old we will be when we pay off our mortgage . If we had stayed on track we would only have 15 more years to go but now we have about 26-28 years :/
We will be 70!!!!!

We'll dh calls me right now and said rated are
low 4% for 20 year loan through Bof A . He didn't see a 15 year loan through them. It will only raise our payment by $100 . We hope to make pay a little extra each month or a lump sum at tax time.
If we go this route we will be 62. My goal is age 60!

Anyways anyone else going to refinance or any tips or deals out there?

 

[mistysue]

Just look around and really ask questions about fees. It seems most banks will have various items to charge you for, some of which can be really expensive.

 

[puffkin]

We refinanced a few years ago to a 15 year at 3.375% (no points). We ended up combining a home equity loan and our mortgage and our payment was within $20 of paying each one seperately. We are past the breakeven point in equity now with doing it that way only 3 years in. We will be 46 & 48 by then. Our goal once the house is paid off is to buy a condo down south and then have that paid off by retirement so that we can snowbird.

I don't put any extra on the mortgage as I feel that we can get a better return investing that money. Same reason I haven't paid off my student loan yet (small monthly payment at 2% interest). I think this is the last year we will be able to itemize our mortgage interest on our tax return because we are almost to the point where the standard deduction works out better (we don't really have any other deductions). I don't regret at all shortening our loan term to 15 years. I know a lot can change over time, but right now it feels like we are on a great track towards our goals and very far ahead of others in our peer group.

 

[tomeaine]

just be a little careful by judging a loan just by the rate #.
what type of fees/credits are with the BOA rate?

guaranteedrate.com has a refi of 4%(4.179 apr) with $1500 credit.
15yr 3.5 with $3300 credit.

 

[BCV2003]

if you refinance, another option to take a few years off is to split your mortgage payment into two payments instead of one each month. You are still paying the same amount but just split. Some mortgage companies allow you to do that and some charge a fee for it so it might not be worth it if they charge a fee. I don't think Wells Fargo charges a fee for it and on a 30 year loan it takes about 7 years off.

 

[DawnM]

What got you off track?

What is your rate right now?

We have a 2.67% on a 15 year mortgage right now. No points or costs but we did this about 2 years ago.

Dawn

Dh and I were talking the other day about how old we will be when we pay off our mortgage . If we had stayed on track we would only have 15 more years to go but now we have about 26-28 years :/
We will be 70!!!!!

We'll dh calls me right now and said rated are
low 4% for 20 year loan through Bof A . He didn't see a 15 year loan through them. It will only raise our payment by $100 . We hope to make pay a little extra each month or a lump sum at tax time.
If we go this route we will be 62. My goal is age 60!

Anyways anyone else going to refinance or any tips or deals out there?

 

[dreamin_disney]

What got you off track? What is your rate right now? We have a 2.67% on a 15 year mortgage right now. No points or costs but we did this about 2 years ago. Dawn

In the beginning we borrowed money in it to pay off some debit . At that time 1/2 my income was going to daycare. Now we are smarter, more budget aware and haven't had daycare for 10 years. We've come along ways

When we bought our house I think we got it at 6% . It's currently a 5%

Dh is going to check it out after work .

 

[firegurl]

I am a mortgage processor. There have been so many changes in the mortgage industry within the last few years that I am happy to say everything is much more customer friendly. 4% sounds just a little high but it's still better than what you are paying. I am not sure what state you are in but if you have any questions, feel free to PM me.

 

[ICF]

If your rate is now around 5% and you would refi into the low 4%, I'd really run the #'s and make sure it make sense. That's a really small drop in %.

We refi'd down to a 15 yr @ 2.75% a couple of years ago --- from around a 4 / 4.25% 30 year loan....but had very little in closing cost.

If you have to pay a decent amount of closing costs, I'd not mess with it. Just send extra $s in each month and pay it off early that way.

 

[dreamin_disney]

I am a mortgage processor. There have been so many changes in the mortgage industry within the last few years that I am happy to say everything is much more customer friendly. 4% sounds just a little high but it's still better than what you are paying. I am not sure what state you are in but if you have any questions, feel free to PM me.

We are in California.

Dh just called me. He said Bofa Wants $4000 in fees and there might be a few more fees. Then he called Wells fargo who we our mortgage with. He's waiting on a call back to get info.

I remind him of our realtor who has a Son that does loans. We went through him last time we refinance . Hopefully some good pops up.

Dh friend tried getting us to do the split mortgage a few years ago but I didn't feel comfortable. Plus we weren't financially stable like we are now. I was always scared but not having daycare opend up a lot of money and we are more budget wise now, thanks to this group

I mentioned the split mortgage and Dh is interested in that but we'll see

 

[wnissen]

Calling BofA or Wells Fargo is not going to get you the best rate. We have been extremely happy with http://aimloan.com which will give you an instant quote with firm closing costs, and stick to them! You can compare many loan types, 30, 20, 15, ARM with several options of closing costs. The cherry on the sundae is that they are a direct lender so they never sell the loan, making it easy to set up the payments. We refinanced last month to a 20-year at 3.75%, with closing costs of $250.

I have no affiliation with AimLoan in any way except as a satisfied customer.

 

[DisneyWitch]

Dreamin - Your post really got to me because I totally relate to what you & your DH are going through. I hope you don't mind me sharing my experience.

I'm not a mortgage person - and I'm not a finance person either. I've never been a money guru. I'm just a computer geek who crochets in her free time. And I have a cat. And here's a low-tech solution that helped me. For free.

Backstory: I got a mortgage in 2003, which would have matured in 2033, which would have made me 64 years old. That would have given me a whole stinkin' year to save for retirement. :no: In 2011, 8 years into my mortgage, I calculated how much I had paid in interest versus principal and I was literally sick to my stomach.

I did a little research in 2011, and that offhand research has me now scheduled to pay off my mortgage by mid 2016 - a full 17 years early. It's actually easy (remember, I'm not so smart about this money thing, so if I can figure it out, anyone can...). Also, I didn't start this "program" until my 8th year into my mortgage. I am a pretty frugal gal, do not have kids, and have had some bumps in my salary since I started my loan. Your mileage may vary.

Here's what I do: I calculate what my mortgage payment breakdown is each and every month - that is, how much of my monthly payment is going to principal versus escrow / interest. Then as often as I can, I send the bank that amount. Remember, your principal amount changes as your loan matures. Don't be afraid to use your tax returns either if you can - if you stuff them in a bank, they don't even make 1%...might as well put them towards your 5% loan.

IMPORTANT NOTE: Before you send anything, check with your mortgage company to ensure that your loan allows for additional payments. Some may not let you do this, or only let you do this a few times a year, or charge you fees every time you send them additional payments. If that's the case, take the additional money and put it in a separate savings / CD account until you can pay the house off in one lump sum.

For example - if I pay $1000/month, and $300 is applied to my loan principal, I send $300 to the bank. Every time I send a "principal payment", I shave off a month off the back of my mortgage. And...I'm not paying one cent in interest on those "shaved off" months either. Because I'm paying down the balance faster, my interest fees also go down every month. Essentially, you're paying an extra month, but without the escrow & interest. Even if you can only do this a few times a year, it will help!

At first, it didn't seem like a lot, but it adds up. While this seems like common sense to most people, it certainly was news to me. I'm kicking myself that I didn't do this from the get-go! I found out later that financial advisor Dave Ramsay advocates this method of paying down a house. I'm not a religious person, so he wasn't even on my radar, but it was a nice validation.

I mean no slight to anyone here who works in banking, but I think that mortgages are nothing but a corporate shell game, and I don't think it's right that people are required to pay 3x the cost of a home to own it. On the plus side, I know I'm doing the right thing, because I keep getting nastygrams from my mortgage company wanting me to take all that money I am sending to them, in order to "invest" in their products. Sorry, I'd rather pay my house off.

 

[disny_luvr]

Dreamin - Your post really got to me because I totally relate to what you & your DH are going through. I hope you don't mind me sharing my experience.

I'm not a mortgage person - and I'm not a finance person either. I've never been a money guru. I'm just a computer geek who crochets in her free time. And I have a cat. And here's a low-tech solution that helped me. For free.

Backstory: I got a mortgage in 2003, which would have matured in 2033, which would have made me 64 years old. That would have given me a whole stinkin' year to save for retirement. :no: In 2011, 8 years into my mortgage, I calculated how much I had paid in interest versus principal and I was literally sick to my stomach.

I did a little research in 2011, and that offhand research has me now scheduled to pay off my mortgage by mid 2016 - a full 17 years early. It's actually easy (remember, I'm not so smart about this money thing, so if I can figure it out, anyone can...). Also, I didn't start this "program" until my 8th year into my mortgage. I am a pretty frugal gal, do not have kids, and have had some bumps in my salary since I started my loan. Your mileage may vary.

Here's what I do: I calculate what my mortgage payment breakdown is each and every month - that is, how much of my monthly payment is going to principal versus escrow / interest. Then as often as I can, I send the bank that amount. Remember, your principal amount changes as your loan matures. Don't be afraid to use your tax returns either if you can - if you stuff them in a bank, they don't even make 1%...might as well put them towards your 5% loan.

IMPORTANT NOTE: Before you send anything, check with your mortgage company to ensure that your loan allows for additional payments. Some may not let you do this, or only let you do this a few times a year, or charge you fees every time you send them additional payments. If that's the case, take the additional money and put it in a separate savings / CD account until you can pay the house off in one lump sum.

For example - if I pay $1000/month, and $300 is applied to my loan principal, I send $300 to the bank. Every time I send a "principal payment", I shave off a month off the back of my mortgage. And...I'm not paying one cent in interest on those "shaved off" months either. Because I'm paying down the balance faster, my interest fees also go down every month. Essentially, you're paying an extra month, but without the escrow & interest. Even if you can only do this a few times a year, it will help!

At first, it didn't seem like a lot, but it adds up. While this seems like common sense to most people, it certainly was news to me. I'm kicking myself that I didn't do this from the get-go! I found out later that financial advisor Dave Ramsay advocates this method of paying down a house. I'm not a religious person, so he wasn't even on my radar, but it was a nice validation.

I mean no slight to anyone here who works in banking, but I think that mortgages are nothing but a corporate shell game, and I don't think it's right that people are required to pay 3x the cost of a home to own it. On the plus side, I know I'm doing the right thing, because I keep getting nastygrams from my mortgage company wanting me to take all that money I am sending to them, in order to "invest" in their products. Sorry, I'd rather pay my house off.

Hmmm. You just totally enlightened me. I may just have to do this. Right now if I keep paying my mortgage like I am I'll have it paid off when I'm 55 and DH will be 59. I am okay with that but after reading about your method I totally think I could do what you're doing. It would be a great feeling to have my house paid off!

 

[firegurl]

My company is a broker in California. Basically that means we are very limited in the fees that we can charge. Lenders operate differently so in this case you are probably better going with a broker. Without getting too techincal, the way we usually make it work is we are locked into a certain amount we charge, usually 2%. We will find the best rate for you and your closing costs. If its a slightly higher rate but it pays 2.5% that extra .5% go to you to cover closing costs.

 

[eliza61]

[

Edited: questions seemed to be offensive

 

[Sandy61]

DH and I have been struggling with this for the past week. We received an offer from our mortgage company a week ago. They are offering no closing cost to refinance at around 4%. We are 8 years into the loan at 50 years old and our monthly mortgage payment is very low. We paid off our previous home and have a fairly small mortgage now. We plan on paying a principal-only payment each month once we start pulling IPERS retirement at age 55. We will keep working until 6o-something and then get soc sec.

Will there be any additional fees?

Should we start over and pay a lower monthly payment? And pay in a monthly amount that only goes to principal?

Would saving $100 a month off-set the higher amount we would be paying to interest and the lower amount to principal?

Don't borrowers pay more to interest at the beginning of the loan rather than later in the loan?

 

[dreamin_disney]

ok Just talked to dh . We both want to do it through someone face to face.

He talked to Wells Fargo
4.125%
Fees $3500 possible more fees but the loan amount is estimated at $3000 less than realtors son


Realtors son
4%
$5000 total
$1700 back from escrow or something like that and skip a payment

wells fargo will be $9 lower. Dh said he's going to talk to wells fargo in person

Dh is also thinking about Just doing loan and paying taxes and home insurance separate. Our taxes will go to pay those off

 

[supersnoop]

Take a look at penfed.org. That's the Pentagon Federal Credit Union. You can qualify for membership by making a donation to a military charity.

They have a 5/5 ARM that has been as low as 2.5%, and they will pay all closing costs. When I refinanced, the only money I had to pay at closing was a years worth of homeowners insurance. Don't be fooled by some banks that just roll the closing costs into the new loan.

 

[eliza61]

DH and I have been struggling with this for the past week. We received an offer from our mortgage company a week ago. They are offering no closing cost to refinance at around 4%. We are 8 years into the loan at 50 years old and our monthly mortgage payment is very low. We paid off our previous home and have a fairly small mortgage now. We plan on paying a principal-only payment each month once we start pulling IPERS retirement at age 55. We will keep working until 6o-something and then get soc sec.

Will there be any additional fees?

Should we start over and pay a lower monthly payment? And pay in a monthly amount that only goes to principal?

Would saving $100 a month off-set the higher amount we would be paying to interest and the lower amount to principal?

Don't borrowers pay more to interest at the beginning of the loan rather than later in the loan?

Usually there could be upfront taxes and maybe a few filing fees. things like that.
Ask your lender for a copy of the HUD statement. they can give you a guesstimate (usually pretty close) of any fees you'll be paying.

But if they are saying no closing cost, it could be they are covering all fees. but ask to be sure.

Yes, generally in the early years of a mortgage the larger chunk of your payment goes to interest.

But most companies will allow you to direct any extra payments to either the principal, the interest or the escrow accounts.

So you can take your extra 100 bucks and have it go directly to the principal.

which in turn will definitely save $$$$ in the long term.

 

[DawnM]

Have you run the numbers on this?

Here is why I will only take out a 15 year and not a 30 year but "pay it off like it is a 15."

A 15 year mortgage is currently at 3% interest. A 30 year is currently right around 4%.

Bankrate.com has calculators to amortize your loan. The below are a little rough just because I prefer rounding if it is a few dollars or cents.

Let's say, for the sake of this example, I take out a $200,000 loan. Here is the breakdown:

15 year loan at 3%. Payments will be $1,381 and I will pay a total of $48,600 in interest.

Now, let's say I think I would rather do a 30 year loan but pay it like a 15 (as I have been advised over and over to do).

30 year loan at 4% but paid in 15 years.

Payments: $1,460
Total Interest: $68,000

I can have lower payments AND save $20K by just getting the 15 year to start with.

Here's what I do: I calculate what my mortgage payment breakdown is each and every month - that is, how much of my monthly payment is going to principal versus escrow / interest. Then as often as I can, I send the bank that amount. Remember, your principal amount changes as your loan matures. Don't be afraid to use your tax returns either if you can - if you stuff them in a bank, they don't even make 1%...might as well put them towards your 5% loan.

IMPORTANT NOTE: Before you send anything, check with your mortgage company to ensure that your loan allows for additional payments. Some may not let you do this, or only let you do this a few times a year, or charge you fees every time you send them additional payments. If that's the case, take the additional money and put it in a separate savings / CD account until you can pay the house off in one lump sum.

For example - if I pay $1000/month, and $300 is applied to my loan principal, I send $300 to the bank. Every time I send a "principal payment", I shave off a month off the back of my mortgage. And...I'm not paying one cent in interest on those "shaved off" months either. Because I'm paying down the balance faster, my interest fees also go down every month. Essentially, you're paying an extra month, but without the escrow & interest. Even if you can only do this a few times a year, it will help!

At first, it didn't seem like a lot, but it adds up. While this seems like common sense to most people, it certainly was news to me. I'm kicking myself that I didn't do this from the get-go! I found out later that financial advisor Dave Ramsay advocates this method of paying down a house. I'm not a religious person, so he wasn't even on my radar, but it was a nice validation.

I mean no slight to anyone here who works in banking, but I think that mortgages are nothing but a corporate shell game, and I don't think it's right that people are required to pay 3x the cost of a home to own it. On the plus side, I know I'm doing the right thing, because I keep getting nastygrams from my mortgage company wanting me to take all that money I am sending to them, in order to "invest" in their products. Sorry, I'd rather pay my house off.