smogtek

Current Mortgage Rates

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I'm in the process of a VA Streamline Refi.

Currently 5.5% 30 year fixed going to a 3.5% 15 year fixed.

No appraisal, no credit check, no costs.

Wife, seeing 2.75% offers, thinks I can do better so mortgage broker doesn't "clean up" on his commission at our expense.

I am locked at 3.5% and feel it's a great rate and should proceed.

What do the professionals think?

Matt

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Those other rates are probably conventional rates... you seem to be getting a good deal though with not having to pay appraisal, credit check or other costs.

All of those would be added on if you went out for conventional mortgages.

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I'm relocking with TD bank TODAY. Rates are 3.175% on a 15yr with a few hundred in bank fees. You will have to pay for closing costs, appraisal, etc though. This is 20% down, 700 middle FICO only.

The thing about the "no fee" loans is that the longer you are in the loan the better off you are paying for these items upfront and taking the lower rate. There is a mathematical breakeven point.

So for example, let's say you have no fees and you get 3.5% and your payment is $1200. Or you could pay $1000 in fees upfront and you opt for 3.175% and your payment is $1125. That's $75 in monthly savings. To recover your upfront fee, you'd have to stay in the loan for 13.3 months ($1000/$75) = 13.3. If you plan on staying in the loan longer than 13 months in this simple example, take the lower rate because every month after month 13 you put $75 into your own pocket.

Obviously access to cash upfront also comes into play, but if it is a strict question of what is a better deal, then do the math.

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I'm in the process of a VA Streamline Refi.

Currently 5.5% 30 year fixed going to a 3.5% 15 year fixed.

No appraisal, no credit check, no costs.

Wife, seeing 2.75% offers, thinks I can do better so mortgage broker doesn't "clean up" on his commission at our expense.

I am locked at 3.5% and feel it's a great rate and should proceed.

What do the professionals think?

Matt

I have personally done two of them - they good. The 2.75% is mostly another company looking for you to financial into an adjustable loan with costing costs.

One thing you could do is ask if you can buy down the rate further.... Getting a lower rate will make the Mrs happy!!!!:D

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Sorry, somehow missed this is a Streamline Refi. Go for it!!!!

Just did an in-house streamline five minutes ago over the phone with TD bank. 4.875% -> 4.00%. Cost half a point on whatever remaining balance you have. $1860 cost, monthly savings = $192. Break even is 9.68 months.

I'm no pro, that's for sure. But I do track rates daily. And mortgage rates hit a new 50 year low in the past two days. Thank you Europe for giving people a good reason to flee your mess of a continent and invest in "safe" US mortgage-backed securities and treasuries. It drove down rates to levels last seen by our great grandparents. :D

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Thanks for the input.

I am happy with the deal.

Being 62, my goal is to draw SS at 66 and continue to work using SS to pay down the principal by age 70 and be able to retire with NO MORTGAGE.

Seems like a "no-brainer" to me.

Edited to add: Plan to be in the house until I retire or it's paid.

Edited by smogtek

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