In my experience, if you want the lowest rate then you have to pay for title insurance and appraisal. Title insurance will be cheaper if you use the same company that did it last time. I was charged 50% less than normal. You might be able to get an appraisal waiver if you have a recent one. You always have to pay the pre-paid interest for the time period before the first payment is due.
Most people focus on no out-of-pocket costs. They either don’t realize or don’t care those things are added to the mortgage balance in the refinance.
That’s my experience as well. Their fees are already baked in the interest rate you are getting, so it is not getting added to your loan amount (at least to my experience), but you need to remember part of your monthly payment went down coz you are now restarting your 30 yr amortization period.
The no-point no-cost refi’s I have done are truly no point no cost (appraisal fee paid upfront but credited back in escrow), of course with higher interest rate than otherwise. If you know you are going to stick with the loan for a long time (I think typically breakeven point is 2 years?) it would make sense to pay points upfront.
The trick is are you really that confident that rates won’t fall further (in the next 2 years) to trigger another refi? Then whatever you paid earlier will just go down the drain.
Has anyone refinanced/obtained_mortgage from companies such as Sebonic Financial, Optimum First Mortgage, Farmers Bank and Trust Kansas City? Any reasons to skip them? Please share.
Among bigger banks when checking via web BOA is also at 3.375% 30 years for me although they have 0.687. I’ll have to check with other big banks or local credit unions to see what might be be available there.
Via Costco Mortgage Mutual of Omaha is giving me 3.375. That name sounds familiar & should be good?
I haven’t used those, but I’ve used online lenders. I’d only go that route for refinance, because closing in a purchase with escrow money is too risky to use them.
They are typically in low cost states, so they have much lower operating costs. I’ll use Zillow or bankrate to shop then see who has the best rate. You might find a few that’ll play ignorant to the online rate and claim it’s “dated” and there must be a data feed issue. Be careful and don’t let them run your credit until you find the offer you want. That way you avoid unnecessary inquiries. They might give you some song and dance about having to run your credit to give you the “most accurate quote”. A long as your score is what you tell them, then it’ll be fine. I’ll point blank tell them I’m rate shopping. I‘ve never had someone refuse to give a quote.
Did you go with online lenders then(for refinance), or did the big banks/physical_banks/credit_unions match the rates of the online lenders?
I’m just trying to assess the risk (if any).
Do you think they take too long to close or play games with numbers when it’s time to close?(of course mine is refinance so that will not apply, but just trying to understand)
I’ve only used online lenders for refinance. I did try with one bank who couldn’t or wouldn’t match. I’m not a jumbo loan though. I think big banks have the best jumbo programs.
I’d just be concerned about them closing on time. They aren’t always the most organized. It works if you know the process yourself. You have to expect a lower level of customer service for a lower price. The good thing is everyone uses online doc submission now and docusign now. That makes it 10x easier.
Another annoying thing for online mortgages is, by the time you close, they’ve already sold your mortgage to another lender. And they keep doing that for every 6 months each time the rates fluctuate - so you end up having to give up using autopay (because otherwise you’ll be mistakenly pay the wrong dude, having to cancel the check and pay the new dude that owns your home )
Most big banks (incl. US bank, citi, etc) have point discount programs that, if you move your assets to their bank account (say 200k), they’ll give you rate discounts (often as high as full % point). After closing, you’re free to wire the $$ back to your savings account. I find this a lot easier than having to deal with questionable company claiming that “they own the home so I need to pay them” every once in a while.
I guess I got lucky. Both my loans got sold to the same servicer I had before. I didn’t even have to create a new account. I could just add the Loans to my profile. Most of the online guys have zero desire to service the loan, so they sell the rights before the first payment is even due.
With current macro environment, would low mortgage rates mean hotter property market or rate is irrelevant it is the macro environment that influence the property market.
Sorry, completely Noob Qns here because when we first got out mortgage it was a whirlwind, so just focussed on the net costs then and didn’t go into the details.
Currently for refinance I am seeing the fees under the following heads as below:
Origination Fee
Credit Report & Flood Cert
Title Fees & Govt. Charges/Taxes
Appraisal (Paid prior to Closing)
What are/are_there other costs/fees outside of the above list?
That list should be mostly it minus some minor charges like mobile notary charges or deed recording charges. Note that your #3 title fees should include the lender’s title policy premium as well as escrow fees.
I am doing a refi right now and we are closing this week. I just noticed that there is a new $150 “affordable housing fee”. Did some research and this is a state-wide fee when recording any real estate document. I didn’t see this fee when I closed a purchase last Dec so this is brand new from 2020. Enjoy.
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