Thank you everyone for all the helpful comments!

BL, re this:

quote:

And a higher appraisal is a GOOD thing!

The agent I spoke to was just giving me estimates (he was looking at my account, since I was on the phone with the company that actually services my mortgage so he had all of my info). But he was estimating based on whatever info he had on his screen, that's different from actually having the loan application go through the underwriters.

So what I meant was, I wonder if he was being overly optimistic in that estimation of this home's value. The number he gave me is about $50,000 more than the current estimate that shows up on Zillow. I believe our house's value has gone up, but more like in the range of $20,000 more than we paid for it (remember, it's only been about 18 months.) Having said that, a house of similar age and size around the corner just sold for close to the number the agent quoted me for our house, so maybe he's looking at comps??

So, let's say the house actually gets assessed at the lower number, not the number he gave me on the phone today. I don't know how much that impacts all the numbers that he gave me, but I would guess it has some impact? Would it impact the interest rate or my monthly payment?

Also, BL, I will ask about splitting our payment... The other thing that I can do is just make a payment on my own at any time, so I could set up a principle-only payment at different times during the months. Those are called micro-payments and I've read that they can really make a difference.

Cindy, Nina, thanks! Tomorrow I will also ask about a modification, I hadn't heard about that.

P*D

quote:

If you save $200 a month and you have $2,000 in closing costs you've got a whale of a deal. Your payback period is less than a year.

Yeah. This is why it matters what the details are of those closing costs. Today I didn't think to ask about it, but tomorrow I'll get him to give me a detailed break down in writing. (A loan estimation sheet??)

quote:

Yes, you can fold most of the closing costs into the loan if you wish so that you don't have to pay any significant amount of cash. That just increases your debt a bit, and raises your monthly payment a tiny bit. But with interest rates this low, that's not necessarily a bad thing to do. Put your money in TIAA-CREF where its long term prospects are much better than the 3% or so you'll be paying on your mortgage.

Good point!!

I'll add another viewpoint.

I'd go for a 30 year note, just to have the flexibility.

You've already looked into micro payments so you know you can pay principle down whenever you want with your extra cash.

So, a 30 year refi would means the lower monthly payments is all you've committed to pay. Using the micro payments, you can shorten your payoff date as much as you want/can. BUT, if you suddenly need a new HVAC system or have some other unexpected expense, you can drop the micro payments for a month or a few months in order to meet that expense.

In other words, the lower requirement of a 30 year payment gives you flexibility with your cash. And so long as you're discipled with the micro payments, it does not result in spending more in interest, or in extending the payoff date.

quote:

Originally posted by ShiroKuro:
Hey y'all, so it looks like I might be able to refinance our mortgage and get a lower interest rate and a reduced monthly payment. I know some of you (??) have recently refinanced your mortgages, can you talk to me about this because I am afraid I might be missing something.

I got a notice in my mortgage account about refinancing, so I contacted my current mortgage loan servicer (i.e. not the original lending bank).

Here's what I was told would be my expenses to re-fi:

1. application fee $100
2. Possible appraisal fee of $445. This is a "possible" fee because we may or may not need an appraisal (the house was just appraised last year, maybe it was in Feb?). I think he said he would have to start the application before we would know for certain about the appraisal fee
3. What would normally be paid as closing costs would get folded into the loan, so I wouldn't pay any closing costs.

That's it, no other fees.

Here's how I would benefit:
1. interest rate would be reduced by slightly more than 1.6%
2. Monthly payment would be reduced by somewhere between $200 to $250.

So. Even if I had to pay for the appraisal, that expense would pay for itself in about 3 months.

This seems a little "too good to be true" -- although, I know roughly what those closing costs are, and so it's not like the bank doesn't benefit here.

Am I missing anything? Anything else I should be asking about?

Thanks in advance for any advice, I would hate to make a misstep!

who is servicing your mortgage. beware! i paid off my rental house in full a few years ago because bank of america kept approaching me about refinancing and the crap they said on the phone turned out to be lies. a friend refinanced her house at about this same time with bank of america and they ended up losing their house!

quote:

Originally posted by Cindysphinx:
We did a mortgage "modification "instead of a refinance. Twice, actually. Once to go from 7% to 5%, and again to 3.5%.

We paid a flat fee, and the lender reduced the interest rate. The payments go down, but nothing else changes. You cannot change the term or take money out.

It was a win for us because no closing costs, and it was fast and easy. It's a win for the lender because they get paid for doing a couple of keystrokes, and they keep our business.

i've never heard of this before. i will have to look into it. we are in process for a refi, but possibly this would be a better option in our case.

quote:

they ended up losing their house

Ok that's terrifying.

Mine isn't Bank of America. I'll pm you the name.

This stuff is so stressful....

quote:

Originally posted by piqué:

quote:

Originally posted by ShiroKuro:
Hey y'all, so it looks like I might be able to refinance our mortgage and get a lower interest rate and a reduced monthly payment. I know some of you (??) have recently refinanced your mortgages, can you talk to me about this because I am afraid I might be missing something.

I got a notice in my mortgage account about refinancing, so I contacted my current mortgage loan servicer (i.e. not the original lending bank).

Here's what I was told would be my expenses to re-fi:

1. application fee $100
2. Possible appraisal fee of $445. This is a "possible" fee because we may or may not need an appraisal (the house was just appraised last year, maybe it was in Feb?). I think he said he would have to start the application before we would know for certain about the appraisal fee
3. What would normally be paid as closing costs would get folded into the loan, so I wouldn't pay any closing costs.

That's it, no other fees.

Here's how I would benefit:
1. interest rate would be reduced by slightly more than 1.6%
2. Monthly payment would be reduced by somewhere between $200 to $250.

So. Even if I had to pay for the appraisal, that expense would pay for itself in about 3 months.

This seems a little "too good to be true" -- although, I know roughly what those closing costs are, and so it's not like the bank doesn't benefit here.

Am I missing anything? Anything else I should be asking about?

Thanks in advance for any advice, I would hate to make a misstep!

who is servicing your mortgage. beware! i paid off my rental house in full a few years ago because bank of america kept approaching me about refinancing and the crap they said on the phone turned out to be lies. a friend refinanced her house at about this same time with bank of america and they ended up losing their house!

I've had a lot of trouble with Bank of America and no longer deal with them.