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  1. #1
    Join Date
    Mar 2006
    Location
    DFW
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    3,967

    Refinance my house?

    I have been in my house for 3 years now. When is it a good time to refinance your house? Called the guy who sold it to me, but he was an A-hole about the hole thing so I didnt get any answers. Can I just call the mortgage company and do it myself or do you need a mortgage broker to do it for you? Anyone refinance their house and how often do you recommend refinancing a house?
    Eat a slice of Humble Pie.

  2. #2
    Join Date
    Jul 2007
    Location
    Jacksonville, Fl
    Posts
    219
    I'm also looking into this,
    I heard if you plan on living in your home for more than 5yrs and you can drop your interest rate 2 poiints or better it is worth it.

    It's around $3800 for closing costs that then will be added to your mortgage.

    I will be talking with a mortgage broker. Right now my mortgage is with a bank.

  3. #3
    Join Date
    Nov 2008
    Posts
    1,673
    Find an amortization table or use a calculator on a spreadsheet on your computer to figure your interest rate, number of payments and principal amount financed. You can also do this with a formula, pencil and paper, and a scientific calculator but it's tedious.

    Anything above your calculated monthly payment is going somewhere else; certainly not to you.

    My own insurance company offered to refinance me. They didn't mention anything about fees, but hidden in the 360 payments was a $5000 bonus for them. Plus, I don't know how much they made on the interest they would have charged me.

    It's the same with car dealers; they have profit hidden everywhere. If you find one "mistake" in their numbers, there are many other places in the whole process where they are taking your money. They seem to go for many small "errors" and "honest mistakes" (all in their favor) rather than one huge theft.

    The Law figures, "If we protect you, you'll never learn to take responsibility for what you sign."

  4. #4
    Join Date
    Nov 2001
    Location
    Seattle, WA
    Posts
    7,744
    A mortgage broker, typically, will work better for your interest as they can represent a variety of lenders and can shop your loan. A bank only represents their interests and can only present to you what they have to offer at that time. Banks continually change what and how they loan depending on thier assets and financial strength that month or week.

    A simple phone call to various mortgage brokers from you indicating that you are interested in finding out if refinancing is beneficial to you is all that is necessary. Any broker that is not interested or doesn't give you a run down of benefits, costs and payments is simply not one your want to deal with. Go on to the next broker.

    Don't pay any upfront fees such as title insurance or street appraisals until you are confident in the broker you are working with.

    Any cost to you must be presented to you in writing up front and agreeded to by you. That is the Federal Law. And costs that you don't understand question. Don't sign anything or pay any fees up front until you fully understand and agree.

    The one exception to upfront costs is that most brokers will require a credit report just to start the paper process to see what you credit worthness is and they will charge a fee for that. A lot of people attempt to refinance because of their own financial troubles and are unfinanciable and the broker needs to find that out up front.

    Be sure to have all your financial information, including your present mortgage balance, payment, interest, term and type of loan and the county tax info for the broker. They will see that you are serious and treat you the same.

    They are also in business to make a living just like us. A good refinance broker should easily be able to take the existing mortgage info that you give them, run it though thier refinace program and give you an answer to see if it's worth our while.
    "The American Republic will endure until the day Congress discovers it can bribe the public with the public's own money.
    - Alexis de Toqueville, 1835

  5. #5
    Join Date
    Nov 2008
    Posts
    1,673

    on second thought

    For the money riding on this deal, buy a handheld financial calculator (HP and others make them), check all the figures and then sell the calculator afterwards.

    Just pulling out a calculator like that and showing them that you know how to use the amortization function will put frowns on the faces of these guys.

    Most people don't understand finance calculations because they involve fractional exponents and http://en.wikipedia.org/wiki/Geometric_series

    In any case, you need to find a lender who's desperate.

    Good luck. . .

  6. #6
    Join Date
    Jul 2008
    Location
    Washington, DC
    Posts
    1,582
    Rule of thumb 100 bucks per one hundred thousand per interest point. So if you have a 250 K mortgage and can drop a point, you save 250 a month.

    Brokers make most of the money from the lender. IE a broker is really a money salesmen, he sell seomeones money to you and they pay him to do it, usually a point or so. So for instance on that 250 K mortgage, the broker collects 2,500 from the lender for closing your loan with them. Honest brokers are like honest techs. they do a good job for the cutomer and make decent money. Hacks are hacks... and they are out there also

  7. #7
    Join Date
    Nov 2001
    Location
    Seattle, WA
    Posts
    7,744
    Quote Originally Posted by WhoIsThat? View Post
    For the money riding on this deal, buy a handheld financial calculator (HP and others make them), check all the figures and then sell the calculator afterwards.

    Just pulling out a calculator like that and showing them that you know how to use the amortization function will put frowns on the faces of these guys.

    Most people don't understand finance calculations because they involve fractional exponents and http://en.wikipedia.org/wiki/Geometric_series

    In any case, you need to find a lender who's desperate.

    Good luck. . .

    Good advice except HP only makes algebraic financial calculators to my knowledge. That means you have to think in the same way a calculation is written out in order in enter information into the computer.

    Texas Instruments have made very easy to use financial calculators that don't require that extra and confusing effort. And there are a ton of free financial calculators/spread sheets located on the internet.

    A lender who is desperate will have desperate employees who will not service you correctly or know the correct methods in which the lenders require information or qualifications.

    Find a broker who is very successful, has a good track record, that does this every day and you will be far ahead. Your home mortage is your financial future. Don't take any shortcuts or missunderstand the process.
    "The American Republic will endure until the day Congress discovers it can bribe the public with the public's own money.
    - Alexis de Toqueville, 1835

  8. #8
    Join Date
    Nov 2008
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    1,673
    Quote Originally Posted by DeltaT View Post
    Good advice except HP only makes algebraic financial calculators to my knowledge. That means you have to think in the same way a calculation is written out in order in enter information into the computer.
    Now that you say it, I remember HP used Reverse Polish Notation, which was hard to use because it is not the way people think.

    And there are a ton of free financial calculators/spread sheets located on the internet.
    I'd get a hand calculator. The Internet already knows too much about me.

  9. #9
    Join Date
    Jun 2001
    Location
    Louisville, KY
    Posts
    12,134
    I did a refi today. Took a first at 6 7/8 and a second at 8.5 to one at 5.0. Major savings per month and long term on interest.

    I found a mortgage broker when we built this home. We used him for the original finance package. He's been checking rates and calling me every few months to let me know the status of the market.

    As others have stated, find a mortgage broker you can trust and knows his business. He was a referral from a couple of friends.
    Perhaps you should have read the instructions before calling.

  10. #10
    Join Date
    Nov 2008
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    1,673
    Quote Originally Posted by DeltaT View Post
    A lender who is desperate will have desperate employees who will not service you correctly or know the correct methods in which the lenders require information or qualifications.

    Find a broker who is very successful, has a good track record, that does this every day and you will be far ahead. Your home mortage is your financial future. Don't take any shortcuts or missunderstand the process.
    Maybe we're both right; a desperate lender or a lender who already has made his fortune may both give you a good deal.
    In that case the lenders to avoid are the ones in the middle, clawing their way to the top and fueled by ambition and greed.
    It might be worth the OP's while to spend some time searching.

  11. #11
    Join Date
    Nov 2001
    Location
    Seattle, WA
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    Quote Originally Posted by WhoIsThat? View Post
    It might be worth the OP's while to spend some time searching.
    It's that always the key to just about anything, isn't it? Get the ducks lined in a row before a decision is made.

    I don't buy anything anymore or deal with any firm till I do a lot of research and checking.

    I use to live in Clinton, MD. You close to that?
    "The American Republic will endure until the day Congress discovers it can bribe the public with the public's own money.
    - Alexis de Toqueville, 1835

  12. #12
    Join Date
    Nov 2008
    Posts
    1,673
    Quote Originally Posted by DeltaT View Post
    It's that always the key to just about anything, isn't it? Get the ducks lined in a row before a decision is made.

    I don't buy anything anymore or deal with any firm till I do a lot of research and checking.

    I use to live in Clinton, MD. You close to that?
    I'm about 12 mi. NW of DC. I know this because on 9-11 I thought I'd have to walk home; the metro was shut down for a while.
    Before that, San Antonio (USAF).
    Before that, NJ.

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