Help with Refi

Shooby_IHB

Shooby_IHB

New member
OK, newbie question.



My current 30 yr fixed is at 5.75%, monthly payment of $1,540.62.



I got a quote with zero points, 4.75%, lowering the payment to $1,354.84. I am electing to pay closing costs up front instead of rolling into the loan to avoid paying interest.



Total closing of $4,500, which includes first month's interest payment. (Effective 5/1, first payment would be due 6/1).



How does this sound? I plan on living here for at least 7-10 more years.



Fees

Appraisal fee- $350

Credit Report- $15

Processing fee- $595

Lender Fees- $900

Interest from 4/28 to 5/1- $106.18

Escrow- $100

Title fee- $600

Wire transfer- $50

Recording trust deed- $100

Escrow Fee- $450

Processing Demands- $75



Thanks
 
[quote author="Shooby" date=1239931039]OK, newbie question.



My current 30 yr fixed is at 5.75%, monthly payment of $1,540.62.



I got a quote with zero points, 4.75%, lowering the payment to $1,354.84. I am electing to pay closing costs up front instead of rolling into the loan to avoid paying interest.



Total closing of $4,500, which includes first month's interest payment. (Effective 5/1, first payment would be due 6/1).



How does this sound? I plan on living here for at least 7-10 more years.



Fees

Appraisal fee- $350

Credit Report- $15

Processing fee- $595

Lender Fees- $900

Interest from 4/28 to 5/1- $106.18

Escrow- $100

Title fee- $600

Wire transfer- $50

Recording trust deed- $100

Escrow Fee- $450

Processing Demands- $75



Thanks</blockquote>
Roll the closing costs into the loan. It will only increase your payment by less than $20/month...keep that cash for a rain day. The processing fee and lender fee are junk fees and the other costs are reasonable. Closing costs do not include the first month's interest payment, they only include interest for a few days.
 
Concur on rolling fees into the loan.



Some questions -



Are you at the closing table, or simply getting quotes?



If you're getting quotes $100 for escrow seems pretty slim. There also aren't any notary costs shown.



Also, how long is the rate lock for? Pretty much everybody is going to run 45-60 days. 4.75 for zero points is great if closing is in 10 days - which is not possible. Add .25 in fee for longer term rate locks.



Did you know most lenders re-priced today, given that the Mortgage Backed Securities market was down 25bpt today? If you got a rate quote in the AM and did not lock, the rate quote might not be the same when you do lock.



Finally, appraisers are so busy right now that you may have to pay a bit more for someone who will have the completed appraisal in early enough.



If you're at the closing table - take the deal.



My .02 - SGIP
 
[quote author="Soylent Green Is People" date=1239944802]Concur on rolling fees into the loan.



Some questions -



Are you at the closing table, or simply getting quotes?



If you're getting quotes $100 for escrow seems pretty slim. There also aren't any notary costs shown.



Also, how long is the rate lock for? Pretty much everybody is going to run 45-60 days. 4.75 for zero points is great if closing is in 10 days - which is not possible. Add .25 in fee for longer term rate locks.



Did you know most lenders re-priced today, given that the Mortgage Backed Securities market was down 25bpt today? If you got a rate quote in the AM and did not lock, the rate quote might not be the same when you do lock.



Finally, appraisers are so busy right now that you may have to pay a bit more for someone who will have the completed appraisal in early enough.



If you're at the closing table - take the deal.



My .02 - SGIP</blockquote>


Rolling the costs into the loan will increase my payment by $28 a month. I've been approved for the loan, but just waiting to lock. I have a 30 day lock I believe. My appraisal was done about two weeks ago. She last quoted me 4.875 but said she could get 4.75.
 
[quote author="Shooby" date=1239947246][quote author="Soylent Green Is People" date=1239944802]Concur on rolling fees into the loan.



Some questions -



Are you at the closing table, or simply getting quotes?



If you're getting quotes $100 for escrow seems pretty slim. There also aren't any notary costs shown.



Also, how long is the rate lock for? Pretty much everybody is going to run 45-60 days. 4.75 for zero points is great if closing is in 10 days - which is not possible. Add .25 in fee for longer term rate locks.



Did you know most lenders re-priced today, given that the Mortgage Backed Securities market was down 25bpt today? If you got a rate quote in the AM and did not lock, the rate quote might not be the same when you do lock.



Finally, appraisers are so busy right now that you may have to pay a bit more for someone who will have the completed appraisal in early enough.



If you're at the closing table - take the deal.



My .02 - SGIP</blockquote>


Rolling the costs into the loan will increase my payment by $28 a month. I've been approved for the loan, but just waiting to lock. I have a 30 day lock I believe. My appraisal was done about two weeks ago. She last quoted me 4.875 but said she could get 4.75.</blockquote>
$4,500 with a 4.75% rate and 30-year term is $23.47 per month and breakeven on the higher payment occurs in year 16 of the loan (not using time value of time).
 
Just an update, I was able to lock today for a 4.625% with 0 points. Total closing costs around $2500, which I'll be rolling into the loan.



Pretty happy with the locked rate though, which is 1.125% lower than my current rate.
 
[quote author="Shooby" date=1240983106]Just an update, I was able to lock today for a 4.625% with 0 points. Total closing costs around $2500, which I'll be rolling into the loan.



Pretty happy with the locked rate though, which is 1.125% lower than my current rate.</blockquote>


$2500 seems way to much in closing costs. Go through a bank directly and refinace better rates and closing costs should be half of that. If you are going through a broker then you are paying too much. Last time i refinanced the closing costs where about $1000 and i was dealing directly with the bank. Shop around from Bank to bank. that seems steep.
 
Processing fee- $595

Lender Fees- $900

Equals junk fees. I can see half that but you are paying 1500 to them to do the loan it should be half.
 
Actually the fees are about in the middle.



When I was at a large, San Francisco based TARP recipient bank, their fees ran around $1200 without the appraisal. When I worked at a broker shop and sent a loan to that same bank, their net lender fees were $800. Mine were $600 so still within $200 of going direct.



Now that I'm back in the "direct / bank" world, our lender fees are around $1,100. You'll find that all companies are pretty close in fee. Some tend to hide their costs better than others, but it's still about the same no matter where you go.



The $2,500 included non-lender costs. You'll never find the lowest fee provider. As soon as you do, someone else will beat it by $1.00. More often than not, the lowest fee provider has the worst service around.



My .02



SGIP
 
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