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Message
Question about home refi
Posted on 5/18/20 at 12:56 pm
Posted on 5/18/20 at 12:56 pm
We've had our current mortgage with a small mortgage company in New Jersey for years.
They recently called me and left a few voice mails and emails. They claim they want to me to refi but they'll pay any of the fees/costs.
What's the catch here? What's in it for them?
Our current rate is 3.875% so it probably wouldn't save us much money.
I guess I'm just typically skeptical of people pushing me to do something like this when there doesn't seem to be any reason not to.
Below is part of an email they recently sent me.
They recently called me and left a few voice mails and emails. They claim they want to me to refi but they'll pay any of the fees/costs.
What's the catch here? What's in it for them?
Our current rate is 3.875% so it probably wouldn't save us much money.
I guess I'm just typically skeptical of people pushing me to do something like this when there doesn't seem to be any reason not to.
Below is part of an email they recently sent me.
quote:
Based on market rates and your positive payment history we’d like to offer to reduce your interest rate.
You’d also skip a mortgage payment after closing, which is a very nice added benefit to this program.
You can choose to keep your remaining term the same, or reset it to 30 years for more monthly savings.
Now, this is not like a typical refinance; there are no lender or title fees, no credit check, no appraisal, and no income or asset verification.
6
Posted on 5/18/20 at 1:02 pm to fallguy_1978
quote:
there are no lender or title fees, no credit check, no appraisal, and no income or asset verification.
Ya right. Waiving some fees and appraisal is happening now, but no credit check or income verification? Sounds like a scam.
This post was edited on 5/18/20 at 1:03 pm
Posted on 5/18/20 at 1:04 pm to fallguy_1978
What was the original term and how many years do you have left? They may be banking on people having a tough time economically and will get you to refi back to 30 years.
I did a refi with my same mortgage company that we closed with last July. They gave me credit on all of the closing costs so it was essentially a no cost refi. I went from 4% to 3.25%.
Doesn't hurt to talk to them and see what it is all about.
I did a refi with my same mortgage company that we closed with last July. They gave me credit on all of the closing costs so it was essentially a no cost refi. I went from 4% to 3.25%.
Doesn't hurt to talk to them and see what it is all about.
Posted on 5/18/20 at 1:04 pm to fallguy_1978
quote:
Now, this is not like a typical refinance; there are no lender or title fees
Might just be repacking their fees into a higher interest rate then what you could get if you went the conventional method.
I would not be under delusion, the closing costs are either being tacked on to the loan amount or rolled into a higher rate
This post was edited on 5/18/20 at 1:05 pm
Posted on 5/18/20 at 1:04 pm to fallguy_1978
Maybe they are trying to keep your business since there are a lot of refis going on
Posted on 5/18/20 at 1:04 pm to ColoradoAg03
It's my current mortgage company so its not like it's just some random solicitation. I just don't know how they are benefitting from this.
Posted on 5/18/20 at 1:05 pm to ColoradoAg03
quote:
but no credit check or income verification?
That does seem a little strange. We had to do all of that for our refi. Also they had us do an appraisal too. House value went up $10k since last July. Not that it means anything as we aren't moving anytime soon.
Posted on 5/18/20 at 1:06 pm to fallguy_1978
quote:
It's my current mortgage company so its not like it's just some random solicitation. I just don't know how they are benefitting from this.
All the money they made from your first loan is already made. They already packaged your loan and gave it to someone else. Originating the loans is where the money is made
This post was edited on 5/18/20 at 1:07 pm
Posted on 5/18/20 at 1:11 pm to UltimaParadox
quote:
Originating the loans is where the money is made
I guess I just don't understand how they are making any money on that if they are paying the fees and currently hold the mortgage at a higher rate.
Maybe the suggestion that I might be able to refi with a slightly better rate somewhere else makes some sense.
Posted on 5/18/20 at 1:15 pm to LSUSUPERSTAR
quote:
What was the original term and how many years do you have left?
We have about 20 years left on a 30. I would not consider anything longer than 20 at this point.
Posted on 5/18/20 at 1:19 pm to fallguy_1978
quote:
We have about 20 years left on a 30. I would not consider anything longer than 20 at this point.
nor should you.
maybe reply and ask for their best offer to refi to 15 years
Posted on 5/18/20 at 1:24 pm to fallguy_1978
quote:
currently hold the mortgage at a higher rate.
They may service the mortgage, but they don't own the loan. Someone like Fannie or Freddie does
Posted on 5/18/20 at 1:26 pm to fallguy_1978
Some posters have been reporting between 2.5-2.75% on a 20-year. It may not save you much on your monthly payments, but it'll help on the interest paid over time.
We just went from 3.875% on a 30 (27 years left) to 2.75% on a 25. Dropped our note $75/mo but brought Princ/interest to 50/50 instead of the 70/30 we were at. Will save us $75k in interest on the lifetime of the loan
We just went from 3.875% on a 30 (27 years left) to 2.75% on a 25. Dropped our note $75/mo but brought Princ/interest to 50/50 instead of the 70/30 we were at. Will save us $75k in interest on the lifetime of the loan
Posted on 5/18/20 at 1:30 pm to UltimaParadox
Does a refi help add liquidity to a troubled batch of loans and sell a new batch that is higher rated?
Posted on 5/18/20 at 1:30 pm to modes
I didn't realize they were that low. Thanks for the replies everyone.
This post was edited on 5/18/20 at 1:35 pm
Posted on 5/18/20 at 2:22 pm to fallguy_1978
1) there shouldn't be any title fees if you are staying with the same company. They are not required to refile a security deed at the courthouse. Edit to add: this is for georgia security deeds.
2) there are streamline refinances that don't need anything. VA and FHA have a streamline process. Some others may be jumping on the bandwagon (assuming that you are not VA ot FHA right now).
3) they are making origination and processing fees despite you not having to cover those.
If it is better for you, it is better for you.
Let me know how it works out.
2) there are streamline refinances that don't need anything. VA and FHA have a streamline process. Some others may be jumping on the bandwagon (assuming that you are not VA ot FHA right now).
3) they are making origination and processing fees despite you not having to cover those.
If it is better for you, it is better for you.
Let me know how it works out.
This post was edited on 5/18/20 at 2:24 pm
Posted on 5/18/20 at 5:00 pm to modes
Where did you find the 2.5-2.75? I am looking right now for a 20, but have only gotten offers of 3 - 3.25% from a local broker and a local bank.
My credit score is high, so I just need to find the right broker. I appreciate any leads.
My credit score is high, so I just need to find the right broker. I appreciate any leads.
Posted on 5/18/20 at 10:51 pm to jsquardjj
Was quoted a 2.99 int rate today. Moving dish from 4.25 to 3 so most likely about to do it
Posted on 5/18/20 at 11:03 pm to fallguy_1978
I was with Freedom Mortgage on my previous place. After 2yrs they contacted me and asked if I wanted to refi. I read and re-read those docs over and over looking for the catch.
I lowered my rate by 1.5%.
Easiest transaction ever.
It cost me NOTHING out of pocket. No closing. Nothing rolled into the principal. Nothing. Initial paperwork done via DocuSign and they sent a notary to my office to sign the closing docs. Knocked like $300 off my note.
I lowered my rate by 1.5%.
Easiest transaction ever.
It cost me NOTHING out of pocket. No closing. Nothing rolled into the principal. Nothing. Initial paperwork done via DocuSign and they sent a notary to my office to sign the closing docs. Knocked like $300 off my note.
Posted on 5/19/20 at 7:43 am to SG_Geaux
quote:
I was with Freedom Mortgage on my previous place.
That's who this is with.
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