HARP and questions about "cost" of REFI

[Gilpatrick]

I've owned my home for about 3-4 years now. Original loan amount $213,000 at 6.75% 30 month fixed. I'm paying around $1,740/month currently. I now qualify for the HARP program and owe roughly $203,000. I was offered a 3.99% $208,000 30 month fixed which includes closing costs of about $2K, and my estimated property taxes that haven't been paid this year yet. I've heard different terms thrown around such as LTV and others calculating numbers explaining to people that there supposed offer isn't "worth it" but I have no idea how this is calculated or if my deal is "worth it". Any advice would be greatly appreciated.

Estimated value of the house used to be $210-230 and is now around 180-190.

Thanks!
Chris.

 

[Zigner]

Yours is not a legal question. You should look for a financial advice board.

 

[OHRoadwarrior]

Google "mortgage refinance calculator" pick a site, then plug n chug.

 

[Mass_Shyster]

I've owned my home for about 3-4 years now. Original loan amount $213,000 at 6.75% 30 month fixed. I'm paying around $1,740/month currently. I now qualify for the HARP program and owe roughly $203,000. I was offered a 3.99% $208,000 30 month fixed which includes closing costs of about $2K, and my estimated property taxes that haven't been paid this year yet. I've heard different terms thrown around such as LTV and others calculating numbers explaining to people that there supposed offer isn't "worth it" but I have no idea how this is calculated or if my deal is "worth it". Any advice would be greatly appreciated.

Estimated value of the house used to be $210-230 and is now around 180-190.

Thanks!
Chris.

I'm assuming you mean 30 YEAR fixed, not 30 MONTH fixed. If so, you are looking at dropping your principle and interest payments from about $1382 per month to $992 per month. The insurance and real estate escrows ($358) should remain roughly the same.

One thing to note is that you're starting all over with a 30 year loan, so you're actually extending the payments out to 30 years from the 26 you have remaining on your present loan.

If you want to make additional payments so you will be done in 26 years, you should pay $1073 for principal and interest (insurance and real estate remain the same).

If you refinance and continue making your present payments, you should be paid off in 18 years, not 30.

 

[HUD-1]

If the refi saves you significant dollars every month on your payment and doesn't cost you anything out of pocket, I would say it is "worth it". They are premium pricing the mortgage to use the overage to fund your closing costs. Make sure the loan is fixed and you are locked in and that the loan is prepayable. You can always approach other lender to compare offers.

 

[Gilpatrick]

Zingler, I apologize.

Steve, thank you very much.