Is this a good refi deal?

[choosinu]

What is the name of your state? California

Refi with cash out - 30 yr fixed, jumbo @ 6.25, 2% fee, 80% LTV based on stats below.

FICO scores 663,671,684 - BK Chap7 discharged 96 - no lates since - high credit card balance to limits - mortgage 1st and 2nd since 2003

 

[HomeGuru]

What is the name of your state? California

Refi with cash out - 30 yr fixed, jumbo @ 6.25, 2% fee, 80% LTV based on stats below.

FICO scores 663,671,684 - BK Chap7 discharged 96 - no lates since - high credit card balance to limits - mortgage 1st and 2nd since 2003

**A: not bad considering it's a jumbo loan.

 

[nextwife]

DO also look at what the vendor fees may be with this particular lender. In some markets, the vendor fees (title, closing, appraisal, etc.) are very competitive. There are lenders who have pricing arrangments with area vendors that may shave huge amounts off the total cost of getting the ,loan. These are generally NOT included in the "points" quoted. Most people don't bother comparing what lender A's title Co charges vs. Lender B. I have seen (again, in some markets, not all) pricing differences of as much as $1000 or more in title insurance/closinfg fees for the same refi, for example. I won't go into the reasons this is so (local lender volumn pricing arrangments vs. dot com lender not well-versed in local pricing alternatives, also, affiliated business relationships in which some lenders have their own title agencies so don't "shop" a better price for the borrower) but it is worth looking at.

 

[MortgageGuru]

Those fees are outrageously high with that interest rate. You are going to pay someone at least $6,600 to give you a loan? You can do a lot better than that.

Nextwife- I have to disagree with you. 99% of the time I have to use a local title company versus one that my company has an agreement with, the local title company is at least twice as expensive across the board.

 

[nextwife]

YOU may, but I know that not all LOs find their borrower the best deal. Many newer LOs working for those with affiliated relationships don't necessarilly even KNOW there is a difference, because they were told when trained "WE use so and so, just quote from this price list..." YOU are exactly the reason one SHOULD look at that- you know to get them the better deal, another lender may not!

Also, when some dot-com lender who rarely writes loans in our market puts a deal together, he doesn't necessarilly even have a clue WHAT the "better" local market rate for certain services may be. He simply places the order and whatever is charged is what is charged.

If a person is comparing your offer to that of some newbie who is using a much pricier provider, YOUR package, even if rates and points are comparable, would be the "better" offer, right? BECAUSE you know enough to also use vendors that work with you to give your borrowers competitive pricing?? So you are proof of my point - you took the extra step to get the better deal for your client. Someone you are competing against may NOT have done so.

 

[BriantheBanker]

Fixed is NOT a good option, especially at 6.25%.

Why would you go with a fixed loan???
Do you intend to live in this house and never refi or sell?
The offer you posted is TERRIBLE!!!!!!
I don't recommend fixed for many. There are some excellent and versatile 'alternative' programs with payment options far superior to Fixed products.
If your goal is to pay your mortgage off faster than 360 months, an ARM could give you a huge head-start on principle reduction.
A $600k mortgage pmt @ 6.25=$3694
A $600 ARM PMT as low as $1999.51 for 12 months.
Making the payment you expect to have at 6.25% with another program would allow you to reduce principle monthly by as much as $1694.49!!!! (3694-1999.51=1694.49) ($1694.49 x 12 = $20,333.88 principle reduction in 1st year of mortgage- making the payment you are planning on.

Confussed?

fixed products are long term. If you plan to make 360 payments to your mortgage company & like the small amount of principle you pay at $3694 per month- fixed is good.
There are many misconceptions about ARMs.

The goal is to reduce principle owed as fast and as inexpensively as possible.

Good luck,

BriantheBanker

 

[nextwife]

I refinanced into a portfolio 1 year arm ARM through a local S&L in 1998. Locally serviced, too. so I can swing by any branch and drop off a payment and immediately get a paid reciept - no risk of fighting over "late" postings due to uncertain mail delivery to a PO box across the country. Three percent max adjustment up or down, 1 percent adjustment max per year. Didn't even need an appraisal because I had better than a 70% LTV per assessment!

ARMS can indeed be a very good deal.

The highest it's even been is 6.895%.
AS of Sept, I'll be starting a year at 4.875%. I always pay extra principal, and have greatly accelerated my amortization.