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Started By
Message
help me with refinance options
Posted on 6/6/12 at 8:19 pm
Posted on 6/6/12 at 8:19 pm
I've had my house for 15 months. Current rate 5.87% 30 yr fixed for $890k, current balance $870k
I am on portfolio loan w zero down and no pmi. I do not plan on ever moving or selling this home.
I will be doing a major outdoor pool/spa landscape for around $100k I've already committed to and will pay for in full. Approval from the county is expected any day and project projected to take 4-6 weeks (which means I expect 2-3 months).
The bank who services my loan contacted me today about refi options (i could lock today) which are assuming 90/10 LTV.
4.75% 30 yr fixed w out of pocket cost est around $1000 maybe less. (includes escrow/title fees)
4.25% 30 yr fixed out of pocket $12-13000. I could pay a portion or roll some into the mortgage if necessary.
I would keep the no PMI clause for both.
I would plan on paying all fees and not rolling into mortgage. I have a friend who is a mortgage broker who says I should roll the costs into the loan. Thoughts?
The other idea I've been considering is waiting till project is completed and saving cash and then doing a refi when I can get 80/20 LTV. I'm imagining rates will continue to be low for a bit but who ever really knows. I am not sure how much equity the project will add, but I wasn't doing it for that purpose. My banker said he ran my property through three electronic valuation programs (whatever that means) and says the values are $948k, $1m, and $1.1m.
I'd be leaning towards thinking $948ish maybe a bit higher due to a fair amount of work already done to the home.
But, this brings me to the point of should I just wait until after the project completion and maybe qualify for an 80/20 and not have to use my lender or to get better rates? Although it seems the rates aren't any better than 4.25% for jumbo--I'd just get less fees from my lender at 80/20.
I almost feel like locking in the 4.75 and paying minimal cost now is a no brainer Then doing a second refi once I get to the 80/20 ltv if rates are still favorable. I'd rather not keep refinancing as it resets the term.
I guess I'm sort of gambling with seeing what the project will add before the refi, but I feel like overall it would be better to just refi once.
Thanks for the replies.
I am on portfolio loan w zero down and no pmi. I do not plan on ever moving or selling this home.
I will be doing a major outdoor pool/spa landscape for around $100k I've already committed to and will pay for in full. Approval from the county is expected any day and project projected to take 4-6 weeks (which means I expect 2-3 months).
The bank who services my loan contacted me today about refi options (i could lock today) which are assuming 90/10 LTV.
4.75% 30 yr fixed w out of pocket cost est around $1000 maybe less. (includes escrow/title fees)
4.25% 30 yr fixed out of pocket $12-13000. I could pay a portion or roll some into the mortgage if necessary.
I would keep the no PMI clause for both.
I would plan on paying all fees and not rolling into mortgage. I have a friend who is a mortgage broker who says I should roll the costs into the loan. Thoughts?
The other idea I've been considering is waiting till project is completed and saving cash and then doing a refi when I can get 80/20 LTV. I'm imagining rates will continue to be low for a bit but who ever really knows. I am not sure how much equity the project will add, but I wasn't doing it for that purpose. My banker said he ran my property through three electronic valuation programs (whatever that means) and says the values are $948k, $1m, and $1.1m.
I'd be leaning towards thinking $948ish maybe a bit higher due to a fair amount of work already done to the home.
But, this brings me to the point of should I just wait until after the project completion and maybe qualify for an 80/20 and not have to use my lender or to get better rates? Although it seems the rates aren't any better than 4.25% for jumbo--I'd just get less fees from my lender at 80/20.
I almost feel like locking in the 4.75 and paying minimal cost now is a no brainer Then doing a second refi once I get to the 80/20 ltv if rates are still favorable. I'd rather not keep refinancing as it resets the term.
I guess I'm sort of gambling with seeing what the project will add before the refi, but I feel like overall it would be better to just refi once.
Thanks for the replies.
2
Posted on 6/7/12 at 7:33 am to 0jersey
So you purchased your home for $890k with nothing down? The assumption that you have 10% equity is a big assumption IMO. Those value estimators will give you a range, but often times aren't reliable. I would complete the pool project first to maybe get a little enhancement in value. If it only takes a couple of months, you should still have great rates available. Then it will depend on your appraisal. As far as closing costs, I would pay them. I'm guessing the majority of the costs will be escrows reserves anyway, which you will basically be transferring from one loan to the other.
Posted on 6/11/12 at 1:06 pm to ds1tiger
So the update is this-
I will have the rate locked at 4.125 and will go ahead if house appraises. If not, I'm only out ~$600 for appraisal.
I don't really have any idea how it will appraise out, but if I'm a little low then I can finish the project and then try again.
I will have the rate locked at 4.125 and will go ahead if house appraises. If not, I'm only out ~$600 for appraisal.
I don't really have any idea how it will appraise out, but if I'm a little low then I can finish the project and then try again.
Posted on 6/11/12 at 7:48 pm to 0jersey
quote:
4.75% 30 yr fixed w out of pocket cost est around $1000 maybe less. (includes escrow/title fees)
4.25% 30 yr fixed out of pocket $12-13000.
a half percent about a point? that's a low cost buy-down.
quote:
I almost feel like locking in the 4.75 and paying minimal cost now is a no brainer Then doing a second refi once I get to the 80/20 ltv if rates are still favorable. I'd rather not keep refinancing as it resets the term.
I would make sure there arent any seasoning issues if this is the route you take.
Posted on 6/11/12 at 10:28 pm to TortiousTiger
What do you mean by seasoning issues?
Posted on 6/11/12 at 11:04 pm to 0jersey
Does a pool really enhance the value of a home that much? I've heard that it can be a detriment, given the maintenance cost and the cost of removal if unwanted.
Posted on 6/12/12 at 12:26 am to Dead Mike
There are posts dated 6/1 from Birmingham Dawg and kev in Houston getting refi rates at 3 and 2.875. They name the particular lenders so you may want to check them out.
Posted on 6/12/12 at 8:40 pm to 0jersey
some lenders and some loans require that the loan be seasoned for an amount of time before you can refi or before you can use a another appraisal for a subsequent refi.
talk to your lender since you have an unorthodox mortgage.
talk to your lender since you have an unorthodox mortgage.
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