PSA. If you own your own house, refi now!

General conversations about BMW E28s and the people who own them.
Mike W.
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PSA. If you own your own house, refi now!

Post by Mike W. »

I'm not quite done with the process, and by all means do not use Freedom Mortgage Co, but rates are crazy low right now. I am stretching what now is 23 years into 30, but dropping the payment $360 a month. Which means the kids wont inherit quite as much when I kick the bucket as they would have. I got a rate of 2.875 which is absolutely ridiculous. A straight refi without extending the payment period would have still dropped it $70 a month, not huge, but 800 bucks a year in my pocket rather than theirs is still worthwhile. I mean that's a good set of tires. And I'm talking about including all the costs into the loan, zero out of pocket. Using your current lender/servicer may simplify things, although as in my case they may turn out to be #$$$#^&@.

I currently have a 3.875 rate, which really is pretty damned good, but dropping a full percentage point does make sound economic sense. I'd started looking at it when I got a cold call and went from there.

Freedom Mtg. A nightmare. I swear I've talked to at least a dozen different people, although it seems like 30. Nobody knows whats going on, nobody returns phone calls at least in the same day, same with emails, but will harass you if you don't sign an online doc in hours. Phone system from hell, hold music ramps up and down in volume but remains constant at a minimum of a 30%THD level.

But if you've got a mortgage with good credit look into it now!
Bonsaibacker
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Re: PSA. If you own your own house, refi now!

Post by Bonsaibacker »

Solid advice Mike but I don't know how these folks are making money. We are on our 3rd mortgage company now trying to get traction. Good credit, submitting documents in a timely manner and doing a s*%! ton of waiting over the past 6 months. Every one of them has been telling me that it is at least a month to review and then they will get back to us. WE haven't gotten turned down, but trying another option in the hopes to get this done. We have bought a fair amount of real estate over the past 10 years, these are our normal providers and I am in shock at the lack of communication and assertiveness they are showing. It is a great time to re-fi but I would choose a smaller bank or look for someone who is hungry. Every one is trying to refinance right now so plan on being aggressive to push through the process.
stuartinmn
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Re: PSA. If you own your own house, refi now!

Post by stuartinmn »

The interest rates available these days are crazy...when I bought my house in 1984, I had to pay 15%. Glad those days are long gone. :)
sail_or_drive
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Re: PSA. If you own your own house, refi now!

Post by sail_or_drive »

Solid advice Mike but I don't know how these folks are making money.
Fees.

I have had good luck working through my Credit Union. Banks and most Mortgage companies are the Devil IMO.
RetiredDoc
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Re: PSA. If you own your own house, refi now!

Post by RetiredDoc »

I own my own house. I do not have a mortgage. Until I paid off the mortgage, my credit union was the owner, and I was essentially paying them rent. At least that’s how I look at a mortgage.

I also consider owning a house as a financial liability, not an asset. It only becomes an asset the instant you sell it. For the rest of the time you live there it costs you money - taxes, repairs, utilities, insurance, upkeep.

If you are considering refinancing a mortgage, be sure to factor in the change in the length of time the mortgage will be extended. Also factor in how many years into the current mortgage you are. If you are at the later stage where much of the monthly payment is applied to principal, think about whether you are taking a step back, trading a lower monthly payment now for paying more in interest and less towards principal. Someone is making money on a refi, and the odds of it being the borrower are pretty slim.
topher800
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Re: PSA. If you own your own house, refi now!

Post by topher800 »

RetiredDoc wrote: Nov 20, 2020 2:15 PM I also consider owning a house as a financial liability, not an asset. It only becomes an asset the instant you sell it. For the rest of the time you live there it costs you money - taxes, repairs, utilities, insurance, upkeep.
Robert Schiller did a study on owning vs renting. He found between 1904 and 2004 that owning house broke even with inflation, and that financially there was no benefit to owning vs renting. Owning does have its benefits, primarily being able to do what want. There obviously exceptions to his averages, Cleveland went down, and Aspen went up.

MikeW, what is the payment if you go to a 15 year? Interest will be even lower...
vinceg101
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Re: PSA. If you own your own house, refi now!

Post by vinceg101 »

topher800 wrote: Nov 20, 2020 7:37 PM Robert Schiller did a study on owning vs renting. He found between 1904 and 2004 that owning house broke even with inflation, and that financially there was no benefit to owning vs renting. Owning does have its benefits, primarily being able to do what want. There obviously exceptions to his averages, Cleveland went down, and Aspen went up.
I would be very curious to see that study updated to show from 2004 to 2019; I am sure it would be saying something very different.
hunneman
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Re: PSA. If you own your own house, refi now!

Post by hunneman »

Mike W. wrote: Nov 20, 2020 12:47 AM I'm not quite done with the process, and by all means do not use Freedom Mortgage Co, but rates are crazy low right now. I am stretching what now is 23 years into 30, but dropping the payment $360 a month. Which means the kids wont inherit quite as much when I kick the bucket as they would have. I got a rate of 2.875 which is absolutely ridiculous. A straight refi without extending the payment period would have still dropped it $70 a month, not huge, but 800 bucks a year in my pocket rather than theirs is still worthwhile. I mean that's a good set of tires. And I'm talking about including all the costs into the loan, zero out of pocket. Using your current lender/servicer may simplify things, although as in my case they may turn out to be #$$$#^&@.

I currently have a 3.875 rate, which really is pretty damned good, but dropping a full percentage point does make sound economic sense. I'd started looking at it when I got a cold call and went from there.

Freedom Mtg. A nightmare. I swear I've talked to at least a dozen different people, although it seems like 30. Nobody knows whats going on, nobody returns phone calls at least in the same day, same with emails, but will harass you if you don't sign an online doc in hours. Phone system from hell, hold music ramps up and down in volume but remains constant at a minimum of a 30%THD level.

But if you've got a mortgage with good credit look into it now!
Mike, sorry to hear you are going through some issues with your refi..all the big lender are swamped with business..due to covid and all the forbearance agreements, But Fannie Mae & Freddie Mac are not helping either imposing more conditions due to the pandemic and or some of the states being partially closed...
I am a Mortgage broker in MA & NH we are taking 35 to 40 days to close.. It's not only the lenders that are back up but the title company's as well.
Rates are extremely low 2.75% on 30 year note and 2.550% on 15 year note with good Loan to value and credit above 740 fico score...
if any one needs help or if they want to pick my brain feel free to pm..I am not sure if I could post my company & contact info with out violating forum
rules.
I never seem rates this low..
Last edited by hunneman on Nov 24, 2020 8:52 AM, edited 1 time in total.
Mike W.
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Re: PSA. If you own your own house, refi now!

Post by Mike W. »

topher800 wrote: Nov 20, 2020 7:37 PM
RetiredDoc wrote: Nov 20, 2020 2:15 PM I also consider owning a house as a financial liability, not an asset. It only becomes an asset the instant you sell it. For the rest of the time you live there it costs you money - taxes, repairs, utilities, insurance, upkeep.
Robert Schiller did a study on owning vs renting. He found between 1904 and 2004 that owning house broke even with inflation, and that financially there was no benefit to owning vs renting. Owning does have its benefits, primarily being able to do what want. There obviously exceptions to his averages, Cleveland went down, and Aspen went up.
I'm surprised with the now gone interest deduction, although like you said it's location dependent. I did buy at a particularly good time, but the people next door are renting and paying over $1K a month more than I am, even after taxes and insurance. Plus it's gone up $300K in the past dozen years.
MikeW, what is the payment if you go to a 15 year? Interest will be even lower...
I did look at it, but it would be about $700 more a month than what I'll be paying. Certainly doable, but in all likelihood I'll kick the bucket before it's paid off, so to me it doesn't pencil out.
Mike W.
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Re: PSA. If you own your own house, refi now!

Post by Mike W. »

hunneman wrote: Nov 20, 2020 9:54 PM
Mike W. wrote: Nov 20, 2020 12:47 AM I'm not quite done with the process, and by all means do not use Freedom Mortgage Co, but rates are crazy low right now. I am stretching what now is 23 years into 30, but dropping the payment $360 a month. Which means the kids wont inherit quite as much when I kick the bucket as they would have. I got a rate of 2.875 which is absolutely ridiculous. A straight refi without extending the payment period would have still dropped it $70 a month, not huge, but 800 bucks a year in my pocket rather than theirs is still worthwhile. I mean that's a good set of tires. And I'm talking about including all the costs into the loan, zero out of pocket. Using your current lender/servicer may simplify things, although as in my case they may turn out to be #$$$#^&@.

I currently have a 3.875 rate, which really is pretty damned good, but dropping a full percentage point does make sound economic sense. I'd started looking at it when I got a cold call and went from there.

Freedom Mtg. A nightmare. I swear I've talked to at least a dozen different people, although it seems like 30. Nobody knows whats going on, nobody returns phone calls at least in the same day, same with emails, but will harass you if you don't sign an online doc in hours. Phone system from hell, hold music ramps up and down in volume but remains constant at a minimum of a 30%THD level.

But if you've got a mortgage with good credit look into it now!
Mike, sorry to hear you are going through some issues with your refi..all the big lender are swamped with business..due to covid and all the forbearance agreements, But Fannie Mae & Freddie Mac are not helping either imposing more conditions due to the pandemic and or some of the states being partially closed...
I am a Mortgage broker in MA & NH we are taking 35 to 40 days to close.. It's not only the lenders that are back up but the title company's as well.
Rates are extremely low 2.75% on 30 year note and 2.550% on 15 year note with good Loan to value and credit above 740 fico score...
if any one needs help or if they want to pick my brain feel free to pm..I am not sure if I could post my company & contact info with out violating forum
rules.
I never seem rates this low..
I think I'm set now, seems like they finally got their act together. Did actually speak to someone yesterday who was trying to help get things rolling instead of just being obstinate. I should have researched it before like I usually do, but I didn't. Freedom seem to have terrible reviews both to do business with and even more as an employer.

I don't think it would be a problem to post your Company and contact info, it's not like you joined yesterday and are spamming the board, you're just replying with possibly relevant info.
mitchrl
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Re: PSA. If you own your own house, refi now!

Post by mitchrl »

We just completed a 15 yr refi with Chase. Everything was online with the exception of inspection and signing which we did at home. Took about 90 days from start to finish with no problems. The only criticism I have was due to the length of time to close, we had to re-verify income etc just about every month which is understandable.

In reference to the comment about how they are making money, with money market funds paying 0.3% there is still plenty of margin for them to keep the lights on ;)
Zeta
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Location: Salt Lake City

Re: PSA. If you own your own house, refi now!

Post by Zeta »

I just became a first-time home owner in August, and I’m sitting with an interest rate of 3.1%. As nice as saving a few hundred a year at an even lower interest rate would be, I feel like it’s probably not worth the hassle.
marek
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Re: PSA. If you own your own house, refi now!

Post by marek »

I just refinanced and got a 2.5% for a 30yr fixed with zero costs (as in my payoff balance from current bank become my loan balance with the new provider) and no $$ to close. It dropped my rate 0.5%. Well worth the 35 day process which was pretty painless. Well worth it
wkohler
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Re: PSA. If you own your own house, refi now!

Post by wkohler »

I’d like to just refinance what I owe to cut the interest rate in half.
Mike W.
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Re: PSA. If you own your own house, refi now!

Post by Mike W. »

wkohler wrote: Nov 23, 2020 9:53 PM I’d like to just refinance what I owe to cut the interest rate in half.
While I went further by extending the payoff date, lowering the interest rate is exactly what I'm talking about. If your rate is over about 3.5%, and your credit is decent and knowing you I suspect it's good, by all means check into it. Granted AZ housing prices aren't as high as Calif, but the percentages don't change. Do it! Think of how many more BMW parts you could buy! :laugh:
Bonsaibacker
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Re: PSA. If you own your own house, refi now!

Post by Bonsaibacker »

Mike W. wrote: Nov 23, 2020 10:10 PM
wkohler wrote: Nov 23, 2020 9:53 PM I’d like to just refinance what I owe to cut the interest rate in half.
While I went further by extending the payoff date, lowering the interest rate is exactly what I'm talking about. If your rate is over about 3.5%, and your credit is decent and knowing you I suspect it's good, by all means check into it. Granted AZ housing prices aren't as high as Calif, but the percentages don't change. Do it! Think of how many more BMW parts you could buy! :laugh:
I want refi to cut our interest rate, not so much extend the timeline- I want to clear the debt asap and less money going to internet means more to the principal. I also want more money for BMW parts!
Cactus
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Re: PSA. If you own your own house, refi now!

Post by Cactus »

marek wrote: Nov 23, 2020 1:26 AM I just refinanced and got a 2.5% for a 30yr fixed with zero costs (as in my payoff balance from current bank become my loan balance with the new provider) and no $$ to close. It dropped my rate 0.5%. Well worth the 35 day process which was pretty painless. Well worth it
How'd you manage that? I figure closing costs would kill any benefit I'd get from a refi.
BMWCCA2
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Re: PSA. If you own your own house, refi now!

Post by BMWCCA2 »

I feel compelled to say that if your home is financed, you really don't own your home. You may be paying to own it years down the road but most never get to that point and that's why there is any discussion about the cost of owning versus renting.

If you own your home—as in no mortgage—it's a different proposition entirely. Certainly current low rates are a great way for many to get out of renting and into a home and, with careful planning and sticking to it, you may some day actually own your home. Flipping houses like cars and carrying the negative along to the next three cars (homes) probably won't help you achieve financial independence.

Just paid 6-months of property taxes today so I'm not really sure how close to owning my home I am, but at least there's no more monthly mortgage payment anymore!
Mike W.
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Re: PSA. If you own your own house, refi now!

Post by Mike W. »

Cactus wrote: Dec 03, 2020 6:38 PM
marek wrote: Nov 23, 2020 1:26 AM I just refinanced and got a 2.5% for a 30yr fixed with zero costs (as in my payoff balance from current bank become my loan balance with the new provider) and no $$ to close. It dropped my rate 0.5%. Well worth the 35 day process which was pretty painless. Well worth it
How'd you manage that? I figure closing costs would kill any benefit I'd get from a refi.
Call them up and ask or run the numbers online. Generally what is done is they include closing costs into the loan amount, so you have no out of pocket, which is not the same as free. But if it's even a modest reduction with no change in the term of the loan, say what was going to be a mere $60 a month in my case, it's still worth it. Even at $700 a year savings, every year for the next 20 or 30, it adds up.

Back on me, Freedom Mtg has me about to slash my wrists. Went to closing on Tuesday and all of the sudden the numbers were off by $3 or 4K, because they included property taxes which I had already paid because it wasn't in the paperwork they had me electronically sign. Grrrrr. So we go back 2 steps.

It can be maddening, but it's worth it just to drop a point, let alone if you're sitting at 7 or 8%. Might not seem like it while in process, but if you calculate the dollar per hour, even for just the first year, it pencils out. Not counting blood pressure meds.
marek
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Re: PSA. If you own your own house, refi now!

Post by marek »

Cactus wrote: Dec 03, 2020 6:38 PM
marek wrote: Nov 23, 2020 1:26 AM I just refinanced and got a 2.5% for a 30yr fixed with zero costs (as in my payoff balance from current bank become my loan balance with the new provider) and no $$ to close. It dropped my rate 0.5%. Well worth the 35 day process which was pretty painless. Well worth it
How'd you manage that? I figure closing costs would kill any benefit I'd get from a refi.
1. I have a high credit score
2. I have high equity in the house
3. I shopped around until I found a lender that wanted my business with the condition I outlined (no closing costs at all and this includes ones tacked on to the loan balance)

It took me almost a month until someone was willing to play ball. Now this might be next to impossible to get done now since there is the 0.5% gov't mandated "adverse market" fee.
BMWCCA2
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Re: PSA. If you own your own house, refi now!

Post by BMWCCA2 »

^^^ Department of Redundancy Department??
Mike W.
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Re: PSA. If you own your own house, refi now!

Post by Mike W. »

I could swear I used to be able to edit the post title, like to say 12-26-20 update, but not currently as far as I can tell.

Anyway, it got done, 10 days ago or so. At closing the numbers were off again, but this time by a negligible amount. It's possible they're all like this, but Freedom Mortgage is so bad. Tons of phone calls with nobody there. Calls at 7AM. Wanting things yesterday but losing the email. I would never have used them if I'd known. Instead of the 2.875 I got, I got a teaser in the mail the day before at 2.375. :shock: Dunno if that's real or a phantom rate. But I went with the bird in hand over the 2 in the bush. The notary doing the signing said something on the order of 3/4 of the mortgages in the US got refi'd this year and all the companies were scrambling. It was worth it in the end, but gawd what process. Like Abbot and Costello Who's on First, except it was with me and my money. But saving $360 a month is worth it.

And supposedly rates have dipped slightly more, so do it if you haven't.
Adam W in MN
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Re: PSA. If you own your own house, refi now!

Post by Adam W in MN »

Exactly why I hate this fucking process. My wife wanted to refi about the same time you made this post, and I wanted to slit my wrists remembering the last time we did it, all the signatures, paystub requests, wanting statements from all my investments and financial institutions.

Well this time I got all that shit submitted and now they said they can't do the loan because my wife is self employed with a small business she runs. Jeezus, lifted my credit freeze, submitted all this personal financial info to the broker, and nothing. Worthless.
Mike W.
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Re: PSA. If you own your own house, refi now!

Post by Mike W. »

I've used a mortgage broker before and the rates varied from impressive to so-so, but the one I used at least kept the madness to a minimum on my end at least. She retired so was no longer an option this time. But it appears perhaps I should have looked for one.

In the end the savings are worth it, but jeez, what a f'ing hassle.
hunneman
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Re: PSA. If you own your own house, refi now!

Post by hunneman »

Adam W in MN wrote: Dec 29, 2020 11:09 PM Exactly why I hate this fucking process. My wife wanted to refi about the same time you made this post, and I wanted to slit my wrists remembering the last time we did it, all the signatures, paystub requests, wanting statements from all my investments and financial institutions.

Well this time I got all that shit submitted and now they said they can't do the loan because my wife is self employed with a small business she runs. Jeezus, lifted my credit freeze, submitted all this personal financial info to the broker, and nothing. Worthless.
sorry to hear about your experience. the only reason why they can't use her income if she is self employed for less than 24 months, If she has 2 years or more, then 2 yrs 1040 are required. But with Covid 19 restriction for Self -Employed in addition you need P&L with 3 month bank statements showing activity in last 3 months. these are guideline from Fannie Mae or Freddic mac..Other than that her income should be used..
an Alternate would be not to use her income if you have sufficient income to cover all obligation.
process should be shorter time..
hope this helps..
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