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Refinancing a mortgage?

Where to start? I tried our current lender, and basically unless you are in financial trouble, and already late on payments, they don't re-fi.
Our credit was crap 8 years ago when we bought our house, both of us being freshly divorced and him filing bankruptcy as part of the divorce. It's much better now, and we're shopping for a better rate.
Mostly everything I've seen online is for consolidation loans ( we dont want to borrow more money!) or for people who are underwater, FHA buyouts, etc.

Anyone have any expertise in this area?

 
PartyGalAnne

Asked by PartyGalAnne at 5:02 PM on Feb. 26, 2013 in Home & Garden

Level 39 (113,292 Credits)
This question is closed.
Answers (7)
  • If you refianance your loan you loose the equaty in your house.

    ^^ Not at all. Say your house is worth $300,000 and you owe $150,000. You have $150,000 in equity. Say your current rate is 6%, and you want to refinance at 3%. Your new loan will be $150,000, the same amount you owe now, but your payments will go down. You can also shorten your term if the rate is low enough. If the original loan was 30 years and you have 22 years left, you can drop the interest rate and cut down to a 15 year, cutting 7 years off of your loan and probably not paying any more for your monthly payment. When the rates are this low, refinancing can save you tens of thousands in interest and get your house paid off faster.

    If they are requiring you to take cash out, you can turn right around and pay it back on the loan. You could even re-cast it immediately for a fee of around $250.
    JulieJacobKyle

    Answer by JulieJacobKyle at 6:56 PM on Feb. 26, 2013

  • What is the percentage you owe vs the current value of the home? How you refinance (and if you can) will depend a lot on that.
    JulieJacobKyle

    Answer by JulieJacobKyle at 5:04 PM on Feb. 26, 2013

  • Call all your local banks and ask to talk to a mortgage officer about their rates. Have on hand the approximate value of the house, what you paid for it, how much you owe, your current rate, etc so you can answer all those questions when you call.
    silverthreads

    Answer by silverthreads at 5:10 PM on Feb. 26, 2013

  • I don't really have any info that is current enough to be useful.
    There is no reason that you can not go to a different lender and tell them you simply want to refinance for a better rate. If they say you must be asking for additional cash in order to do it, ask what the minimum amount extra would be. Figure out which bill or bills you could pay off with the additional cash (credit cards would be my first chice since they have the highest rate generally.
    Figure out how much in fees it is going to cost you to refinance and then calculate the difference over the course of the loan.
    You can also calculate the lack of payment to the CC company as well. Often it is not worth it to refinance but sometimes it is.
    You present company says no because they will lose money in the long run.
    Dardenella

    Answer by Dardenella at 5:46 PM on Feb. 26, 2013

  • Crap PGA if I didn't say it I did mean other local bank or credit unions.
    Dardenella

    Answer by Dardenella at 5:51 PM on Feb. 26, 2013

  • If you refianance your loan you loose the equaty in your house. That is 8 years of equaty. Probably better to sell the house and buy a different house.
    louise2

    Answer by louise2 at 5:55 PM on Feb. 26, 2013

  • We don't have any credit cards to pay off. We could put a hefty chunk on a car payment or something, or use extra money for new carpet or something.
    One or two I looked at online the minimum was $5,000 to borrow, and about $800 estimated in closing costs.
    We don't belong to a credit union. The only one around here is for teachers/school employees.
    I'll check with the local bank.

    Thanks!
    PartyGalAnne

    Comment by PartyGalAnne (original poster) at 5:57 PM on Feb. 26, 2013