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VA Streamline Refi


momof5
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I have a question on VA Streamline Refi......

Why are they 'charging' 1.5 to 2 pts for "loan discount" (buying down the interest rate to 4.5%.....current VA loan rate is 5.0 on valoan.com). My current interest rate is 6.0% It seems like they are charging me extra...dunno...this just doesn't make sense to me.

One company wants to charge 1.5% the other 2%. Both offer 4.5% APR.

Broker #1 has the VA funding fee in the GFE, Broker #2 doesnt. (hmmmm)

Broker #1 has the 1% orig fee paid by me, Broker #2 has it paid by broker. (huh?)

Broker #2 including the recording fee. Broker #1 didnt.

Almost looks like I could be in for a surprise at closing if I sign either contract.

Any words of wisdom?

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They have to send you a good faith estimate before closing.

The only real surprise you will probably get at closeing is that if you want a new title policy. That isn't generally included. Mine wasn't.

You buy down the interest rate up front to get the lower

4.5. That's up to you. I think it just depends on the company. as to who charges what. They're not all going to be the same.

If you're not in a hurry, check out a few more.

There are some pretty good VA refinance companies out there who.. while they make money, aren't going to skin

you.

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It was my understanding that VA and FHA streamlines were fast and not costly around 1000-1500 depending on the amount of the loan.

What you posted would seem to be a regular refi or new loan with those 1 1/2-2 points added and a buy down option.

MORROW?

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I have a question on VA Streamline Refi......

Why are they 'charging' 1.5 to 2 pts for "loan discount" (buying down the interest rate to 4.5%.....current VA loan rate is 5.0 on valoan.com). My current interest rate is 6.0% It seems like they are charging me extra...dunno...this just doesn't make sense to me.

One company wants to charge 1.5% the other 2%. Both offer 4.5% APR.

Broker #1 has the VA funding fee in the GFE, Broker #2 doesnt. (hmmmm)

Broker #1 has the 1% orig fee paid by me, Broker #2 has it paid by broker. (huh?)

Broker #2 including the recording fee. Broker #1 didnt.

Almost looks like I could be in for a surprise at closing if I sign either contract.

Any words of wisdom?

Now, are they offering a rate of 4.5% or is the APR 4.5%? There is a difference. The APR is your annual percentage rate calculated with all costs included so they tend to be higher than the interest rate, where as the interest rate is just that, the actual interest rate with NO costs included.

If they are offering you a 4.5% APR, buying it down, you may actually be getting a lower rate than the 4.5%, which would actually be a fantastic deal in my opinion.

I did some research on VA rates, from smaller lenders to bigger ones. The majority of them didnt even have 4.5% available at this time. Not to say its not, but it was not even offered on our daily rate sheets and may require an "off sheet" pricing request. I know Im working on one loan (FHA) that we are waiting for 4.5% to become available without having to buy it down. When I checked this morning it was going to cost almost a full point to get it. Other lenders were charging anywhere from 1-3 points just to get a 4.875%

If you are working with a broker, which it sounds like you are, they have various lenders that they work with. Which would explain why one company offered you 1.5 points to buy down and the other 2.

There will always be a VA funding fee associated with the loan, however the amount will vary depending on different factors.

As far as the other fees, my only guess is that each lender is different and may have everything structured differently as well. Call them on it and ask.

Streamlines (both FHA and VA) typically cost less than a traditional refi, however there are some costs associated with them. The majority of which can be third party fees (title, escrow, etc). Obviously it has to make sense in order to do it.

I hope that helps. :D

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Yes, that did help.

The rate was 4.5 so the APR was 4.717.

It turns out that the second broker had an issue with his automated system. It was marking ALL loan GFEs with Origination Fee paid by Broker and wiped out the VA funding fee.

Since I caught the problem they had (saving them thousands), he chopped a few hundred off a couple of fees and bought me a gift certificate to a nice dinner out on him! :mrgreen:

The refi saves me $155/mo and when the Homestead exemption takes effect, I will save that much more. Too cool. (Not to mention the 2 month break on mtg payments!!! :mrgreen::mrgreen: )

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(Not to mention the 2 month break on mtg payments!!! :mrgreen::mrgreen: )

Congratulations! The ability to skip 1 or even 2 months payments can make all the difference in the world to some.

On a personal note, we refinanced our home in December and were able to skip both December and Januarys payments! How nice is that?!?!? Not to mention that we had gotten checks from both of our previous mortgage holders for our leftover escrow accounts. :)

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