The Good Faith Estimate (GFE) is one of the worst ways to compare lenders. I must get asked for a GFE 10 times a week, and 10 times a week I try and explain that using a GFE is the wrong way to compare lenders. Below are a few reasons why: Read the rest of this entry »
I had a potential client approach me about a possible refinance. They said they had been getting fliers and phone calls saying they were eligible for low, low rates for a refinancing. Hmmmm, low, low rates? She said she thought she was unable to refinance. I asked two questions and knew she was unable to refinance. She had no equity in order to refinance, and a crazy story!
When people say you can do something, maybe they just want to see if you can do something. I'll cut and paste the whole conversation, you may find it interesting and helpful the next time you get a flier in the mail or a cold call Read the rest of this entry »
Rates are still very, very low by any measure, even though they have gone up some in the past few months. Although we went through a refinance boom in 2010, there are still plenty of people who want to refinance. Many of them still can, and some cannot. Why can't they? Read the rest of this entry »
Some people call me about taking some equity out of their home, this is called a "cash out" refinance. Lately, people have been calling me about putting "cash in" to their refinance to pay the loan down. With property values having fallen in some markets, instead of giving up on refinancing some people should consider paying the loan down by paying some of the principal down at settlement.
It seems these days putting cash into your house may get you a better return than stocks! Freddie Mac says 33% of all homeowners who refinanced a mortgage in the 3rd quarter of this year paid down at least a portion of the original loan. This figure was up from 23% in the second quarter. Freddie Mac began keeping track of these stats in 1985, and they show the "cash-in" share of refinancing activity was the highest since they started tracking these numbers 25 years ago.
Not only is paying down your loan a sign of a real estate market that has gone down in many areas, it is likely a sign of the fiscal times. People seem to feel they have taken on a lot of debt, and its time to pay it down. So "cashing in" may be a wise economic move, or it may just make you feel better to owe less money. Either way, talk through the savings, closing costs and the potential returns on paying down principal with an experienced mortgage professional, it may make sense for you!
I had clients who applied for a refinance almost 4 months ago. Interest rates dropped for quite a bit of that time period, and it seemed like once a month they were asking me for a better deal than I had originally locked them in at. Getting a better deal is fine, steamrolling everybody in your path to pick up each 1/8% rate drop is another. Read the rest of this entry »
What is HAMP? It is the "Home Affordable Modification Program". But what is it actually? Read the rest of this entry »
Sometimes people just can't squeeze it all in. Right now, it is hard for banks to fit all the business they have through their systems. Now, I am the first one to pile on the banks for their Read the rest of this entry »
Having an existing home equity or 2nd trust line can cause a problem when refinancing your mortgage. Unless you are closing the equity line/2nd trust and paying it off by wrapping it into the new loan amount, keeping your equity line/2nd trust could cause a problem in several ways. Read the rest of this entry »
Those “no cost” refinance deals, while real, are a bit misleading. They are usually advertised on cable TV or radio, and are short on details. What they don’t tell you is that they charge a higher rate for a "no closing cost" refi. So the costs are essentially built into the rate. If Read the rest of this entry »
Cash out refinancing, where you borrow above what you owe on your existing mortgage, is many times a better way to go than getting an equity line. Equity lines are usually adjustable rate mortgages based on Prime Rate, which is currently very low. But: Read the rest of this entry »