Refinancing

jbarto65 · Joined: 04 Nov 2007 Posts: 626 -0.11 Dollars($)

How long should you keep your current mortgage and what is an indicator that you should try and refinance.

Is it good to take a look at getting a new loan every now or then or should you just stay wear you are if you are actually having a descent chunk coming off the principle?

What are your thoughts?

larry · Joined: 27 Jun 2007 Posts: 3328 473.40 Dollars($)

Hi jbarto,

I think it is not good to refinance now and then. You will have to pay closing cost and also prepayment penalty if you refinance.

If you are in ARM and the rate has gone up and you can't afford it. At the same time you get an offer of affordable rate and terms. Them you should go for it.

Even if you have a FRM and you get an offer of attractive rate and terms; and after calculating those closing costs and prepayment penalties, if you see that you are gaining then you can surely refinance.

There is an article in this site regarding refinance. You can check this out - http://www.mortgagefit.com/refinance.html

Hope this will help you.

Feel free to ask if you have anything to ask or share Smile

Best of luck,
Larry

lisascherzer · Joined: 04 Jan 2008 Posts: 749 0.10 Dollars($)

There really is no set amount of time to wait to refinance. Most say that when you save 1% or more that it will be worth it to refinance. Right now the 30 year mortgage is 5.375 for a mortgage over 200K and 5.50% for a loan under 200K so if you have a rate that is over 6.375 then I would say there would be enough savings to refinance.

What are the balances on your mortgage(s) currently?

patricia · Joined: 16 Jan 2008 Posts: 133 0.92 Dollars($)

I think ours is at 7.something.We have the varible rate we started at 60,000 for 20 years i think ,or could be 30,and are down after 20 years to 39,000 I think.Does that sound like we need to refinance?

larry · Joined: 27 Jun 2007 Posts: 3328 473.40 Dollars($)

Hi Patricia,

It is not that you have taken the mortgage for seven years that is why you will have refinance. If you get a better rate rates and terms then you can surely refinance.

People sometimes refinance to get some cash in hand for some urgent need to pay may be higher rate credit card debts. You can check the page I've referred above to know when and when not to refinance.

Hope this will help you.

Feel free to ask if you have any questions.

Best of luck,
Larry

patricia · Joined: 16 Jan 2008 Posts: 133 0.92 Dollars($)

I was reading on a news website that if your rate is less than 6. something you should refinance.Looks like it would have said if your rate was over 6 then refinance. Anyway.Sounds like if we refinance and got some cash and paid off some bills that would help us tremendously.But my hubby just makes more loans ,that makes no sense to me. If I need money I would refinance at a lower fixed rate(we have a variable rate) get some cash to pay off some high interest loans and have less bills.If we are having a hard time paying the bills why make more.We may have a few years added to our home loan but we will be in debt that long anyway right?

lisascherzer · Joined: 04 Jan 2008 Posts: 749 0.10 Dollars($)

Hi Patricia,

You are right. If you have a rate that is over 6.50% right now then it would make sense to refinance. I think it would work out well for you to consolidate the high interest credit cards and loans that your husband has taken. Even if you extend your payments a little on your mortgage, it usually would take that long to pay off a credit card at minimum payments. You might be surprised to find out that you may be able to save money and not extend your mortgage. I have seen this in many cases of bill consolidation. I think it could make sense for you to look into consolidating your bills with a refinance at this time.

patricia · Joined: 16 Jan 2008 Posts: 133 0.92 Dollars($)

I agree but how to convince hubby of that. Can you refinance if you have a second mortgage.We borrowed to buy cabinets for our kitchen.Hubby says our bank does not offer a fixed rate mortgage and thats why we got stuck with the variable rate. We have had payments from 300 to nearly 500 as it is now.We struggle to pay them when it is that high and have to deal with it for a year.We started at 60,000 and are down to nearly 39,000.Is it possible for a bank to not offer a fixed rate mortgage?I think he is hesitant to go elsewhere because his family has banked with the same bank so long and we have for 11 years now.

banker0679 · Posted: Thu Jan 24, 2008 12:40 pm Post subject:

there are other banks/lenders that can do 'wonders' with rates/products that a normal bank can't do. I say 'wonders' because there isn't 1 lender that has all the mortgage products out there.

patricia · Joined: 16 Jan 2008 Posts: 133 0.92 Dollars($)

Thnks,I will see if I can get my hubby to check it out.SDounds like a good deal to me.But can you refinance if you have a second mortgage?

banker0679 · Posted: Fri Jan 25, 2008 11:21 am Post subject:

Depends on the value of the home.. (loan to value)...also depends on the lenders

patricia · Joined: 16 Jan 2008 Posts: 133 0.92 Dollars($)

It was appraised at twice what is owed on it.We have done improvements on the place added 2 ponds and more rooms and an extra bathroom.I canm't remember the exact figure but it was more tah twice that we owe.

Jessica · Posted: Mon Jan 28, 2008 4:57 am Post subject: RE: refinance now

Hi Patricia,

I understand perhaps your husband wants to deal with the same bank as his family has been doing since a long time. But if it doesn't offer fixed rate loans, I feel you should try out with some others.

If you are having problems in paying if off, better go with some other loans - any fixed rate loan as rates are now comparatively low. I think you should not miss this opportunity. At least try shopping with some lenders if your bank doesn't offer the loan you're looking for. And, it's always better to compare and then decide upon the right offer. So, I think it's ok to start shopping.

You can refinance even if you have a second mortgage. The only thing is to subordinate the second loan if you are refinancing the first. Depending upon your financial situation and credit profile, you may refinance both the loans into a combine loan or just the first and pull out some cash to pay off the second.

Regarding the appraisal, you need to do it again because you have made improvements. So, that should be considered while determining your home value.

Regards,

Jessica

patricia · Joined: 16 Jan 2008 Posts: 133 0.92 Dollars($)

Thanks for the advice,I like your thinking. I really don't want to replace the 3 loans we managed to pay off this year with 3 more. My hubby has already replaced one. Makes no sense to me.We struggle to make the loans we have so everyone we pay off is great.Not to be replaced i think. But thats where me and my hubby dissagree.

adonis · Posted: Tue Jan 29, 2008 3:12 am Post subject:

But Patricia, you need to come to an understanding with your hubby as far as managing the finances are concerned. The key is to think wisely an then take financial decisions.

All times are GMT - 7 Hours
1 2 Next
Page 1 of 2