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refinancing, want to skip next payment??

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's picture
kpatrick | Joined: October 29, 2007 05:46 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

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

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:49 | Post subject:

Niicss's picture
Niicss | Joined: October 3, 2005 11:54 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

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.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

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

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:49 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

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.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

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.

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kpatrick's picture
kpatrick | Joined: October 29, 2007 05:46 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

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

Kim

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gmakerley's picture
gmakerley | Joined: November 9, 2007 07:36 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

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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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Kim,
Your message was not hateful at all. I think the message from "Guest 2" was directed towards "Guest 1"
George,
Thanks for your reply as well. I believe "Guest 2" was simply trying to defend the integrity of this thread.
"Guest 1's" comments were unecessary as they pertain to someone's personal financial situation. Maybe the original poster is strapped for cash and is looking for a way to lower thier mortgage payment. At least, they are out there trying to learn and take steps towards bettering their situation, as opposed to just defaulting and adding to the stress of the economic woes. I applaud when anyone takes responsibility and makes efforts to put themselves in a better position. In any case, thanks to the professional and helpful comments, especially from Kim and George. I was looking for advice for my own situation and found the answer to my question here. Thanks,
Andy

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jveenstra's picture
jveenstra | Joined: November 10, 2008 09:03 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Although already answered several times, I'll throw in my 2 cents.

The next payment is not due the 15th. The next payment is due the first. The grace period after the due date of the first is fifteen days and if you pay in that time period you do not incur a late charge.

Your loan probably closed by now???

You only "skip a payment" if the loan is high enough to cover all costs and 60 days of interest.

The payment due Nov 1st was for interest for the month of October. If you did not pay before closing you owe interest on the old loan from Oct 1st to Nov 24 (or whatever closing date is/was). You also pay interest on the new loan to end of month.

If your refinance was cash out, you paid 60 days interest plus late charge for the old and the new loan and you just received less cash out.

If it was a rate and term refinance you either had to bring money to closing or got less than $2,000 at closing.

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gmakerley's picture
gmakerley | Joined: November 9, 2007 07:36 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

more like 2.5 john. :)

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christinehynes's picture
christinehynes | Joined: September 5, 2009 11:56 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

It all depends on when your refinance loan closes, but also your mortgage person could do it such that they let you skip the payment, but remember that you will still pay the interest in advance and it will roll into your principal balance in order for you to skip your payment.

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riseabove's picture
riseabove | Joined: November 9, 2009 12:58 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Cash out refinancing is a great move in some cases, but it's got to be a lot more unciommin now given the equity drops in recent months.

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gmakerley's picture
gmakerley | Joined: November 9, 2007 07:36 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

i've witnessed too many occasions on which a borrower was advised not to bother making the due payment in the month that a loan was being refinanced, only to have the closing postponed; or a late charge added that could have been avoided; or a myriad of other disastrous consequences.

if you're going to refinance, and there's a payment due, pay it. it's not going to hurt to do so, and it can prevent some very frustrating situations from occurring.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

my loan is due 15th i cant pay until the 24 9 days late can they fireclose

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jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi j bax,

No, the lender won't foreclose the property if you're 9 days late on your payment. The lender will start the foreclosure process only when you're more than 3 months late on your mortgage payments.

Thanks

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