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How often can/should you refinance?
Main Post:
We bought a home 3months ago with a 7/1 Jumbo @ 7% !!!
Our lender offered us a refinance offer of 6.25% with only $350 in closing costs (after lender credits) bringing our EMI down by ~$500.
Definitely a no brainer whether to refinance or not, however other lenders are asking us to wait since they expect rates to go down even further by EoY.
My question was
- Is there a rule of thumb around how often you should refinance? Is there a downside to refinancing twice in a year?
- Does it make sense refinancing or should we wait for further drop?
- My original lender giving a better refinance offer than the original loan seems like bad business. Is it normal for lenders to offer lower rates on their own mortgages?
Adding more context, we are in not desperate to refinance and can sustain paying the originl EMI. But of course don't want to miss out on a chance on potential savings.
Thanks in advance!
Top Comment: The rule of thumb is if it’s 1% or greater it’s likely worth it. There’s no rule of thumb on how often that can be, it’s all related to costs and how long it will take the recoup those costs. $350 total seems outrageously small. 100% go for that.
Should we refinance now or wait? Looking for opinions please.
Main Post:
Currently our mortgage is 30 year conventional at 6.75%, which we took out last July.
Now, today our broker emailed us with this offer. 6.125% no points 30 year fixed with closing cost of about $2500. Saving us just over $300 monthly.
Should we wait for lower interest rates or make the move now?
Top Comment: LO here: So you're saving $3600 annually with a cost of $2500, that is a no brainer. Having said that, you may want to look over your LE and see what your new loan balance will be. There is a high chance that the $2500 is your cash to close but your loan balance went up.
What refinance rates are you getting right now?
Main Post:
Looking for the best rate without points.
Top Comment: The best offer I’ve gotten so far is 5.875% for a 30-year conventional loan with no points, no closing costs (with $2400 in lender credit), and an escrow account. I wanted to wait to see if the Fed reduces the rate by 50 bps instead of 25, but worried the rates will go up if it’s only a 25 bps cut. Thoughts on locking in now? I’ll likely look to refinance again at some point next summer if rates keep dropping.
Is refinancing my mortgage a good idea if I can lower my interest rate from 7.25% to 6.5%?
Main Post:
I am doing a streamline FHA refinance. After crunching numbers, it takes 10 months to break even. Meaning my current principal is $308K and after the refinance it will be $314K. I will save $144/month. I only pay $1100 at closing. At some point, I want to refinance from my FHA to a conventional to remove the PMI. I don't have 20% equity yet though, I have done significant renovations: new roof, new HVAC, new kitchen, new deck, remodeled bathroom, added 1/2 bathroom, replaced tile floor with hardwood floor. So, I would need these upgrades to add $60k in value to my home in order for me to do a conventional loan and get rid of PMI. Does it make sense to wait to do a conventional loan refinance or take the locked in rate now?
Edit: I failed to mention that by refinancing I'm not paying 2 months of mortgage. $5800. As I only purchased last year, the majority of each payment goes toward interest.
Top Comment: Just be aware they are rolling in what looks like closing costs and escrow. To calculate your true break even you calculate the payment difference and then divide that by all non-escrow costs. Just to get your principal balance back down to what it was previously is over 40 months not the 10 months you thought.
When should I refi? Locked in at 6.25% 30 year Fixed
Main Post:
I close in the house back in August at 6.25% 30 year fixed with 25% down. I’m wondering when I should refinance the house? My loan mortgage officer says that unless I’m saving more than $200 a month, it doesn’t make sense to refinance. Do you all agree? What is the magic number at which point I should refinance?
Top Comment: Loan amount info would help here. But generally looking at rates rn, would not make sense as you’d likely have to buy down your rate. Dropping 1% on a $1mm loan is much different than 1% on $150k.
Where are people going for good refinancing rates? Current rate is 7.5%
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Where are people getting good refinance rates deals from? Credit scores in 790s, mortgage of 275k to refinance, current rate is 7.5%. HHI about 230k yr only other debt is 135k student loans.
Not in huge rush to refinance but feel that rates maybe coming down and worth it!
Top Comment: Following! In a similar boat. Not much debt, good credit score, refi for 700K and have a current 7.5% rate. Can't refi until June, but can lock in around April 20th. Feels like I'm still seeing posts about 6.5% rates - but when I check Bankrate, places like Optimum and Sage are showing 5.5% (guessing they're full of shit). Just hoping for something in the low 6s.
I really can't refinance?
Main Post:
Hi All,
I purchased my home 2 years ago, 20% down on a 30 year fixed. My rate is around 7.3%. I've seen things on the news about rates going down since then and I've reached out to my mortgage broker a couple of times asking if we could refinance, and each time he has said no, we have to wait until the 10 year treasury bill goes down to around 3.5%.
Now I see rates are as low as 6.7%...I am confused why I can't refinance and have to wait on this treasury bill? When I ask him, he is very thorough in his answer but it honestly makes no sense to me. I don't know if that's because of how new I am at learning this stuff, or if there could be something he is missing? Any help is much appreciated!
Top Comment: If you don’t trust the advice you’re getting, get a second opinion. But if I had to guess, this is probably his point: It’s costs money to refinance. You pay part of your closings costs again to start a new loan. Conventional wisdom is that the costs of refinancing are typically only worth it for a full 1% drop, so 0.5% improvement might not be worthwhile.
What is the refinance rate now
Main Post:
My current rate is at 7.125% for 30 year fixed. I got below two offers
- 6.3% closing cost- $4.8k
- 5.87% closing cost- $9.2k
There are no discount points in this. The #2 lender is charging 1% origination fee so closing cost is higher. What is the refinance rate everyone else is getting?
Top Comment: 1% origination fee is quite literally the same as 1 discount point...
First-time Refinance and my loan got 13k larger, is it normal or i got scammed?
Main Post:
hi folks, first time doing the re-fi. After 0 cost re-fi (basically applied for a new loan), and now the loan got 13k more than what I left before, I had about 800k loan before re-fi, and after refi, a new loan becomes 813k, and I have 2 months I can post-pone the pay, so basically I can choose to pay this two months 6k + 6k and start my new loan at 800k again in Jan, or I choose not to pay the loan till Jan, my new loan will start from 813k,
btw my rate was 6.4% and now it's 5.85%
is this normal? Or do I feel I got scammed? i feel there must be a better way to do it?
Top Comment: There is no such thing as a true no cost refinance... might not have to pay cash, but there is always a cost. https://www.debt.org/real-estate/mortgages/refinance/no-closing-costs/#:~:text=Just%20as%20there%20is%20no,sound%20or%20look%20on%20paper .