Have any of you refinanced your mortgage lately?

My current mortgage is at 4.05% APR. I have been seeing people refinance for rates in the low 2% range. The last time I checked with my current mortgage company their best rate for a VA loan was still over 3% and wasn't worth refinancing. I might be better off now to go to a 15 year mortgage, or at least not go more than 20 years, which is how much time I have left on my current mortgage. What company did you use? I don't trust these things that pop up on FB (like Quicken and similar places), most of them seem like shysters to me. Any amount I can lower my monthly payment due to paying less in interest is a net income increase...
I'm in the same situation. I'm 10yrs into a 30 @ 4.1%. Remaining principle is ~$130K on a home worth ~$320K today. I'm not in a situation where I wan't my monthly payment to go up and I don't want to throw away money on closing costs just to stretch the mortgage back out to 30yrs, just to get ~2% As it is now I make one extra principle payment per year.

I was seeing something like $8K in closing costs, although I only researched online. Still getting calls, emails and texts from them. No thanks.
 
I also suspect much of the public doesnt understand the difference between the rate and APR.
This. There are lots of fees that got rolled into the loan so that apr can be different from the rate.

One thing I found after refi a few times, is that often it is worth refi with "cash out" to pay for the expense if your plan is to pay off faster. There are also brokers who will pay you a certain amount out of their pockets to get your deal, and they figure since they have low cost (remote broker with low cost of living competing in high cost of living area, they got a good wholesale deal, or they are paid bonus to meet a certain target).

At one point I only need to borrow 200k but the rate increase dramatically when it went below (I think) 300k, so I just went ahead and borrow 300k and pay that 100k back right on the first payment. It works out well. Most people are not as disciplined.
 
Thanks. OK, so there is some kind of pre-existing agreement of how much you have to pay to break the existing mortgage. Is it based on a certain amount of months of mortgage payments?
Typically, banks sell their mortgage to Fannie Mae or Freddie Mac, the gov "banks" that buy mortgages and package them into MBS and then sell to investors, with government guarantees. This is how you end up with 30 years mortgage in the US (vs the 6 month to 5 year loan in Canada we call them ARM loan in the US, adjustable rate but same payment amount after the initial 3-5-7 years vs fixed payment loan for 10-15-30 years), and how the whole 08 recession started because some banks cheated on the lending standard and they end up having to buy back these MBS because the default rate is higher than usual.

So those originator banks sell the mortgage ownership, and they get the cash back with some one time profit, and then they make some money every month servicing the mortgage. They now are in the market to lend new mortgage again so if they do not compete for your refi someone else will, and they are also benefiting from your refi because they get to sell the same mortgage again back to Fannie and Freddie for profit.

Back in the recession some cannot refi because you screw up your credit score and Fannie and Freddie will offer program like HARP to let you refi from your original loan to a new loan to lower your payment. They figure lowering your payment will make you less likely to default and they already own your mortgage anyways, it is not any worse than having you gone and come back as a new customer.

Typically there's a 6 month "seasoning period" before you can refi again, most bank want you to have 6 months before they can sell your loan and they probably won't break even if you refi every week. You can always pay it off early without prepayment penalty, I haven't seen any US home and auto loans that have prepayment penalty from legit banks so far.
 
Just as I suspected, my refinance inquire cam back with mid to high 3 % (15 year vs 20 or 30 year APR). This was not enough of a decrease in interest rate to make a refi worthwhile. I will just be stuck with what I have until the bottom drops out of the interest rates again...
 
I‘m currently working on a refi through NFCU, who is also my current lender.

3.25 —> 2.50 VA However, I‘ll have to pay half a point and 1% origination fee on $300k. With additional closing costs it’ll take me 7 or so years to recoup. I plan to stay in the house forever.
 
I‘m currently working on a refi through NFCU, who is also my current lender.

3.25 —> 2.50 VA However, I‘ll have to pay half a point and 1% origination fee on $300k. With additional closing costs it’ll take me 7 or so years to recoup. I plan to stay in the house forever.
Well said, some people forget to take this into account ^^^
The savings even become less when one takes into account that the .75 interest savings is even less because you are already getting a tax deduction on the .75%
Much of it also depends on how far "into" you are on the current mortgage. If someone does "refi" they should make darn sure that the mortgage will be fully paid off by the date of when the original mortgage was to be paid off.
Example;
If someone is 10 years into a 30 year mortgage and refinances for a lower rate into a new 30 year mortgage they should make darn sure that they pay off the new mortgage in 20 years(not 30) by making extra payments or they just waisted 10 years worth of paying nothing but interest on a loan and still almost owe the same amount of money from when they first bought the home.
The first 10 years of paying a mortgage its literally almost paying nothing but the interest on the mortgage and you almost still owe the same amount of money you did when you bought it 10 years earlier. If you dont pay the refi off in the same time period the original was to be paid off you could end up making TWENTY YEARS worth of payments and still owe almost he same amount of money because over the 20 years you only paid the interest and nothing towards the home (principle)
 
We were only three years into our mortgage and we’re opting for another 30. When I calculated the time to recoup our closing costs I compared to the original cost of the first loan, not how much I owe now, which is $15k less.

Why? Obviously my refi payment would be lower due to less owed on the new loan. Add into that the closing costs, which are NOT rolled into the loan and it‘s easy to get confused based on a projected lower payment alone.

It’s easy to see that $160 savings and think it’s ALL free money!

Its also a VA loan and I read in the documents that I can add up to $6k for home efficiency improvements. I may do that, since the loan rate is lower than what I’ll likely get from my money elsewhere. I also KNOW that my attic insulation is inadequate, at least.

Finally, I think I’m lucky going with NFCU, in that they likely won’t sell the loan. The documents say they can, but also say that they plan on servicing the loan themselves.
 
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What matters is interest expense. Rate is 1 part of the equation; do not ignore balance and time.
Depending on where you are in your mortgage, you may be able to mimic a 15 year loan by putting extra into your payment.

I had many loans while paying off our house. Generally the cheapest, no cost, short term variable loans. I made the biggest monthly payment I could.
The strategy was to minimize interest expense and maximize principal reduction. Interest is a cost!
I refied numerous times.

It was tough, no vacations, new cars, etc. I drove used Hondas and Toyota Pickups.
It feels really good to own a home free and clear.

Good luck.
 
I've consider it a while back but I backed off; we have 30Y mortgage at 3.87 we moved in in 2016; outstanding principle is at $155K while house is estimated @ $320K; I asked my current lender and they quoted us at 3% but with $4K at closing costs out of pocket; I did not like it assuming reset the time and savings .87% at 15Y; I backed off

in our case if we only add $100 extra a month we would cut the mortgage time frame for 4.5Y and that's we are going to do once I pay off my Accord
 
Closing costs would eat up most of my savings this close to the end. Wells Fargo used to let me go from my current rate to halfway to the going rate with a phone call, but no more.

I would dearly love to live mortgage free while fully employed but it’s probably not worth the hit to my liquidity to do that. Also not worth the hit to my cash flow to aggressively try and pay it off early.

Instead, I realized that an occasional prepayment was like buying a tax free bond at 6.125%. (I can’t get above the standard deduction anymore.). I’ll take it.
 
I would never pay any closing cost. I always opt to refi with some cash payment from lender / broker to pay for the expense. This must stand on its own to lower my interest expense for the same duration or else I am not refiancing.

This way I know I will be walking away with better deal no matter what I do, instead of "oh boy I just wasted money for nothing but I need to sell the house or move, or I have a better deal now and shouldn't have refi last time" remorse.

No matter what, you still need to be discipline to pay off the mortgage, or else no refi will help you if you just spend them all.
 
My current mortgage is at 4.05% APR. I have been seeing people refinance for rates in the low 2% range. The last time I checked with my current mortgage company their best rate for a VA loan was still over 3% and wasn't worth refinancing. I might be better off now to go to a 15 year mortgage, or at least not go more than 20 years, which is how much time I have left on my current mortgage. What company did you use? I don't trust these things that pop up on FB (like Quicken and similar places), most of them seem like shysters to me. Any amount I can lower my monthly payment due to paying less in interest is a net income increase...
I am currently working to cash-out loan, refi mine.

Current: 27 years left on a 30 year mortgage. PMI $55/mo. Payment @1100/mo. ish Rate 3.75%
Planned: re-up to 30 years, PMI:gone, Payment $1300/mo ish. Rate 3.75%

Cash-out will allow me to cut $800-1100/mo off of monthly expenditures by paying other things off, though, which is the motivation. I don't think the 3 years added will bother me much, as I plan to pay extra on the house and eliminate them anyway.
 
Rates are super low again. 2.5% 30 year par/slight credit on the ratesheet. VA/FHA par rates in the 2.125 range. Anyone paying 3% or more is wasting money right now. google "wholesale rate sheet" learn how to read it and understand just how much extra your broker/bank/cu is charging. 1 point over wholesale is good, 2 points over is what many charge. "no cost" refinance is really where you get a wholesale level credit that pays for the broker and title fees. like a (2.00) rate of 2.25 FHA today would probably cover your costs for example. or 2.75% fanny mae 30 year would give (2.4 points) and cover all sorts of costs for ya.
 
As far as I know, refinancing a mortgage means improving the terms of the loan, such as lowering the rate, changing the repayment period, or reducing the financial burden. Going to the bank for refinancing makes sense if the mortgage has been arranged recently and if the rate on the new loan will be beneficially different by a couple of percents. Today I found out that the "new" bank no longer provides such a service, as refinancing any loans (including mortgages) is available on the terms of an ordinary consumer loan, namely, with a period of up to 3 years. In the case of refinancing a 12-year mortgage for 36 months, the monthly payment looks unfavorable. Recently I needed 1000 euros in credit urgently. The guys offered me about 30 options from different banks, and I chose the most favorable one.

$1000 euros? That's just pocket change, you're not going to get a mortgage over that amount of money. Plus now you're talking European and the laws, rules and customs are completely different over there. I don't think they have anything like 30 year mortgages here.
 
I bought the house I live in back in 95, it was 7.5% for a 30 back then. At about 10 years in is when rates went down into the 5s so I re-financed it to a 15 at 5.5%, payment stayed the same(within 50 bucks one way or another, can't remember). I started making decent money 5 or so years later and paid it off shortly thereafter.
I've never understood people who will spend a dollar to save 30 cents in taxes.
 
I am currently working to cash-out loan, refi mine.

Current: 27 years left on a 30 year mortgage. PMI $55/mo. Payment @1100/mo. ish Rate 3.75%
Planned: re-up to 30 years, PMI:gone, Payment $1300/mo ish. Rate 3.75%

Cash-out will allow me to cut $800-1100/mo off of monthly expenditures by paying other things off, though, which is the motivation. I don't think the 3 years added will bother me much, as I plan to pay extra on the house and eliminate them anyway.
This is typically a terrible idea as people get themselves right back in debt- because none of their spending habits have changed, only now it is worse because the mortgage is also higher.
Hope things work out for you though.
 
This is typically a terrible idea as people get themselves right back in debt- because none of their spending habits have changed, only now it is worse because the mortgage is also higher.
Hope things work out for you though.
My mortgage actually went down to 1075, and I killed PMI. Took out a smaller amount. Wiped out credit card debt, and now huying a new vehicle. Payment will be the same, it will cut my fuel costs in half, retain value better, and the surge in used prices is making sure I trade into it with zero negative equity. These moves, togather taken as a whole have added about $500/mo to my disposable income, strengthened my credit score, and netted me a new vehicle that will maintain positive equity throughout the ownership thereof. Oh, and new vehicle has a $7500 tax credit that Ill enjoy in a few more months.
 
Anyone paying 3% or more is wasting money right now.

This is a bit of a misleading statement. You need to balance the interest rate with the value of the loan. If you are handy with excel you can quickly figure out your break even point. My current mortgage is at 2.75% and when rates were at 2.25% it did not make sense for me to refinance because of the closing costs. I could not recoup enough of the costs to make it worth my time.

Just my $0.02
 
I am not sure if you can call 250K in Texas can buy you a great house. Location matters. I'd compare 400k to what is equivalent of a great house in Planos. You can go to Houston if you want but you won't get those higher paying jobs there vs a real tech hub.

The way Texas deal with the electrical grid the semiconductor industry will leave soon, and the tech hub may leave too. Infrastructure matters. NXP lost 100M because of the power issue.
I seem to recall reading about rolling blackouts in California this past year.
 
This is a bit of a misleading statement. You need to balance the interest rate with the value of the loan. If you are handy with excel you can quickly figure out your break even point. My current mortgage is at 2.75% and when rates were at 2.25% it did not make sense for me to refinance because of the closing costs. I could not recoup enough of the costs to make it worth my time.

Just my $0.02
3% or higher would net someone (with great credit) a free or nearly free refi to a lower rate. If they are better off doing so or not would be situational. I should clarify "wasting money" maybe like wasting money changing your oil too soon. You may have good reasons to do so.
 
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