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Refinancing house mortgage... options?

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dullard said:
In most cases, a 1% change is a worthwhile refinance (unless the balance is miniscule or unless you plan to pay it off/sell the house or refinance the refinance soon).

Since he owes $157k now at 6.5% interest, that means he pays $850 in interest a month. Even if he had $3k in refinance costs and it moved to a $160k balance, at 5.5% interest, that is $733/month of interest. His savings would be $117 a month.

He'll lose on the refinance if he touches the refinance in the next 2 years. He'll make a miniscule profit with this move if he keeps that refinance untouched for 2-3 years. He'll profit nicely if he keeps that refinance untouched for 4+ years.
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Yes, we plan on keeping the house for at least 4+ years. Once we have kids and they start growing up the house would be too small, but right now it's a good size.

Skoorb:

We live in like the #1 or #2 worst place in Florida for house values... my house value is around half of what I owe. Sucks but it's reality and I don't want to be a bum and stop paying like what seems half of my county has.
 
I did an FHA streamline refinance for 15 years at 4.5%. I would really recommend shortening the term and raising your payments slightly, than just look to lower your payment.
 
handyrandyrc said:
Don't go with this guy. And I'd REPORT him. This kind of garbage is what got us into this mess in the first place. Financing something without appraisal, or with INFLATED appraisal is BAD. Part of why the market is so inflated in the first place. We've had bad greedy brokers, greedy people, buying more than what they could afford, 100% financing, etc. Bad ju-ju

You live in more house than you can afford? Sell it. Can't sell because you're upside down too far? Settle for a short sale, and take the huge ding. Otherwise, you just have to suck it up and pay. I'd not re-finance, even if it were to save me a little each month. Those costs are all rolled in and you'll be paying for stupid fees for 30 years.
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This advice is AWFUL -- don't listen to it OP.

Seriously, how did you come up with this ridiculous advice? Did you consider for one moment that the OP might actually want to live there but wants to pay less? The bolded part is especially ludicrous -- if he is pay significantly less each month, who cares?

That being said, you might look around and be patient. I had a similar offer from my mortgage company (Chase) for 5.5% but I would have to pay closing costs. After I laughed them off the phone and told them I was going to shop around (I have EXCELLENT credit), I got a Fed Ex letter the next day from Chase with an offer for a 5.125% rate, no closing costs, and no appraisal. I am jumping on it, even though I could probably get a slightly lower rate. This should be relatively painless and with no fees.
 
cpals said:
Yes, we plan on keeping the house for at least 4+ years. Once we have kids and they start growing up the house would be too small, but right now it's a good size.

Skoorb:

We live in like the #1 or #2 worst place in Florida for house values... my house value is around half of what I owe. Sucks but it's reality and I don't want to be a bum and stop paying like what seems half of my county has.
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I live in Palm Beach...my house tanked 50%...I had to do a modification. No one else would take it on. My credit was stellar.

I thought you were just a little upside down. I don't know if the FHA will really take this on once it's presented to them...
 
Jumpem said:
I did an FHA streamline refinance for 15 years at 4.5%. I would really recommend shortening the term and raising your payments slightly, than just look to lower your payment.
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Was your original mortgage a 15-year FHA loan? I'm getting mixed results online, but some places are saying if you have a 30-year fixed you must streamline into a new 30-year fixed.
 
The rate savings for a 15 year aren't worth the requirements that you MUST make that larger payment each time...you can get almost 99% of the benefit by making those same payments on a 30 year loan with the flexibility to back off on a 'bad month' if you have too.
 
Jumpem said:
I did an FHA streamline refinance for 15 years at 4.5%. I would really recommend shortening the term and raising your payments slightly, than just look to lower your payment.
Click to expand...

that's great advice, but 15 yr will cost him more, regardless of how good rate is

it would be ~$200 more per month than now
 
postmortemIA said:
that's great advice, but 15 yr will cost him more, regardless of how good rate is

it would be ~$200 more per month than now
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Ah, I think I'd rather lock in at the lower monthly payments and just pay extra on the principal when I have the money. When house values start going up (I can dream!) my taxes are going to start inflating my mortgage payments again.

Thanks for all the tips guys.
 
Alot of lenders are doing rate modifications.
Have you asked your current lender about it ??
From what you said, you're only looking to live in the house for another 4-5 yrs.
If thats the case look into getting a 5/1 or 5/5 and get better interest rates.
 
Called BOA and he also said the same things as Quicken Loans. He's offering 5.5% as well, but said I'm catching the rates on a upswing.

Do you think the rates are going to come down or should I lock in now?
 
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