refinancing, want to skip next payment??

Guest

Hello,

I'm refinancing my home loan with a company other than the current mortgage holder. My next payment is due on the 15th. The loan shold close on the 23-24th. Question- would you skip this month's payment? If yes, whats the best way to do this?

Thanks

HMAN

kpatrick · Posted: Mon Oct 13, 2008 7:14 pm Post subject:

Hi Hman,

You can skip the pymt, but I would be sure not to spend the money. If your deal closes, great, you will be fine, but if for any reason it does not close by the 10/28, I would go ahead and make the pymt. Remember, with a refi, there is a 3 day right of recission (if this is your primary home), so if it doesn't close by the 28th, you need to make the pymt, b/c although you will have closed, the loan will not be paid off.

Kim

Niicss · Posted: Mon Oct 13, 2008 8:18 pm Post subject:

Hi hman!

Kpatrick is absolutely right in saying that you should keep the money and in case your deal doesn't close, you should pay that to the lender. However, I would suggest not to take any risk and pay the money to the lender on the due date.

Thanks.

Guest

Kim & Niicss, Thanks for the advice. Have a great day.

Posted: Tue Oct 14, 2008 4:58 pm Post subject:

Of course there's the late charge you'll have to pay. Can't believe you're that desperate for cash! If you're going FHA, there's another problem since HUD doesn't want to see a "double capitalization" of payment -- you're NOT skipping a payment, look at your HUD 1 and THINK.

Posted: Wed Oct 15, 2008 9:26 am Post subject:

Hi Guest,

I don't know if you are new around here, but the msg you wrote to HMan was very unnecessarily hateful. The folks that offer advice here pride themselves on their professionalism, and your comment was out of line.

There IS a valid reason why you would not want to make that last pymt and it is because if you go ahead and make the pymt then the mtg company will be sending you a check back for the unused P&I from the date you close to the end of the month. Not only that, but it usually takes the old lender 4-6 weeks to process this. Same concept as taxes...why would you pay the governement OR A MTG CO more than you need to so that they can earn interest on your money.

Yes, there will be a late fee, but it is not normally a large amt (depends on your mtg balance), so in the past when I refinanced myself, I did this very thing. Yes I had to pay a late fee, but I got to hold onto my money and didn't have to wait for the lender to give me MY money back...and it always seems they keep more than they need on these.

Just because HMan doesn't want to give away his money, doesn't mean that "he is desperate" You should THINK before you hit submit.

kpatrick · Posted: Wed Oct 15, 2008 9:27 am Post subject:

And I need to THINK about signing in before I hit submit! (:

Kim

gmakerley · Posted: Sat Nov 22, 2008 5:53 am Post subject:

i always advise people to make their monthly payment despite a refinance being around the corner. especially in the current market, there is an awful lot of time being consumed in the process of getting a loan to closing. in this case, if the closing were delayed until the last couple of days of the month, and with a rescission period added in, the old mortgage would run more than 30 days delinquent and guess what - a 30-day late appears on the credit report.

kim, i don't think your response was in the least "hateful" and furthermore, the "guest" who stated that it was appears simply to have a less than favorable attitude towards lenders in general. "they" (the lenders) are not in the business of taking in more money than is contractually due - lenders charge appropriate interest as specified in a promissory note. in addition, late charges are disclosed well in advance of the origination of a new mortgage, so every consumer is notified properly of the consequences of late payment.

i've seen too many people harm their credit standing because of bad advice (usually from loan officers) that they need not make the current payment because their loan is being paid in full anyway.

everyone needs to be on top of their finances at all times, wherever possible; particularly in the current economic climate.

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