Mortgage Refinance

[robav8r]

To any of you with significant real estate / mortgage experience: at what point is it prudent to consider refinancing your mortgage? I have heard a decrease of at least 1% is necessary before you should consider in order to make the closing costs worth it. Thoughts ???

 

[bert]

Take the costs associated with refinancing (everything from origination fees, appraisal, document fees, etc) vs. the monthly savings and see how long it will take you to make your money back (then compare that with how long you plan to be in the house). Don't forget that if you roll the costs into the new loan you will be paying interest on those costs (all the more reason to be wary of 'garbage' fees and inflated expenses).

There are some very good rates out there - I am refinancing a property myself at the moment and rates are very good on 30 year conforming loans. You can already see some of the effects of the sub-prime mess though, so don't expect to find many good deals on variable rate or interest-only loans.

 

[robav8r]

Take the costs associated with refinancing (everything from origination fees, appraisal, document fees, etc) vs. the monthly savings and see how long it will take you to make your money back (then compare that with how long you plan to be in the house). Don't forget that if you roll the costs into the new loan you will be paying interest on those costs (all the more reason to be wary of 'garbage' fees and inflated expenses).

There are some very good rates out there - I am refinancing a property myself at the moment and rates are very good on 30 year conforming loans. You can already see some of the effects of the sub-prime mess though, so don't expect to find many good deals on variable rate or interest-only loans.

Thanks bert - yeah, I'm trying to capitalize on the decreasing market & rates.

 

[Dawgfan]

If you have 30% equity in the house, NFCU has an awesome 5.25% 30 year conforming. You have to pay .75% origination fee and closing costs, but it might be worth it. These rates change frequently, and with today's .75% fed cut they might come down even more.

 

[Hozer]

Rob, USAA offered me a better 30 yr fixed rate with lower closing costs than NFCU. I locked at 5.5 two weeks ago, but I bet it's lower already...

 

[robav8r]

Rob, USAA offered me a better 30 yr fixed rate with lower closing costs than NFCU. I locked at 5.5 two weeks ago, but I bet it's lower already...

. . . . .checking now, thanks!

 

[A4sForever]

I have a 5.0 ARM (5 yrsr old) that's coming due to roll in a couple of months. I think w/ the 3/4 point drop today, another month or so might be a good time to re-fi. We'll see ....

I've been predicting a drop in rates for 2-3 years. Nothing at all to do with the markets. I'm not a soothsayer -- just think election year ...

 

[Machine]

Instead of a rule-of-thumb, how about some calculators:

http://mtgprofessor.com/calculatorsOriginalMenu.htm

See 3a or 3b, depending on your situation.

 

[Mumbles]

If you did the VA, you are currently eligable for 4.875 streamlined through JP/Chase....the only bank that currently isn't beholden to the Arabs or Chi-coms. 3/1 ARM guaranteed at that rate for 36 months. About 9K in closing costs, but I'm saving $250 a month on my mortgage....and don't pay a mortgage for 2 months! Also...if it was VA..the loan can only go up +/- 1 pt every year after 36 months.

 

[bert]

About 9K in closing costs, but I'm saving $250 a month on my mortgage

Nothing wrong with it if it works out for you, but people reading your post need to understand that by the time you recoup the closing costs (minus any interest paid if rolled into the loan), it is eligible to adjust.

 

[Mumbles]

Nothing wrong with it if it works out for you, but people reading your post need to understand that by the time you recoup the closing costs (minus any interest paid if rolled into the loan), it is eligible to adjust.

absolutely..... With any luck, I plan on unloading this condo, ( I'm in Alexandria, Va) in the next 3 years. The market here is fairly insulated from what's going on in the rest of the country.