Why did I buy a condo?? (Refi help) I now have some ##s

[justme]

Dec 4, 2019 14:31:35 GMT -5 haapai said:

Have you done the work and math to figure out what taking out a 401(k) loan would entail? 

I'm generally bearish on 401(k) loans for multiple reasons but sometimes investigating the bad options in detail can push you to take actions that you would not otherwise have taken. 

Does your 401(k) plan allow you to borrow?  Will it allow you to borrow this much?  What are the payback periods and interest rates?  How would such a loan, if permitted, affect your paychecks?  Will you be able to contribute to your 401(k) and/or receive a match if you take out such a loan?  Could you afford to do so?  Is repaying such a 401(k) loan ahead of schedule possible or is it such a PITA that doing so is unlikely? 

The answers to these questions might be so dispiriting that HELOCs and personal loans start looking more palatable. 

Oh, 401k is pretty much a non-starter. I have no idea if my current job allows it, but I'm looking for a new one anyways which would move the loan squarely into "pay lots of penalties" when I leave. And right now the loan interest rate would be way less than I'm getting in the market AND a lot more that a refinance/whatever. 

Was just stating that's where most of my money is. My net worth is probably something like 50% 401k, 40% equity (not accounting for the assessment coming), and 10% non-401k savings. 

[haapai]

Either massive penalties or lots of quick footwork.  Yeah, scratch that unless you want to calculate just how much it would hurt you. 

But I stand by what I said about investigating all of your options in as much detail as you can muster.  Sometimes figuring out just how expensive and risky all of your available moves are is crucial to making the best choice and doing what you have to do afterward. 

[Tiny]

You mention taking a Home Equity Line of Credit (variable rate)  -  maybe a Home Equity Loan (fixed rate) would be a better option - because of the fixed rate?    But then again, it doesn't look like interest rates are going to go up anytime soon... so maybe the variable rate wouldn't be a future problem.      

[justme]

Dec 4, 2019 15:44:11 GMT -5 Tiny said:

You mention taking a Home Equity Line of Credit (variable rate)  -  maybe a Home Equity Loan (fixed rate) would be a better option - because of the fixed rate?    But then again, it doesn't look like interest rates are going to go up anytime soon... so maybe the variable rate wouldn't be a future problem.      

I was trying to figure out what the other one was called and it was escaping me and only HELOC was popping up when I tried to google it. I'd much rather have a fixed rate as I honestly don't think they'll get THAT much lower - especially for condos. 

It'll probably come down to numbers on which one works better. I'm guessing refinance will prob win since I can probably get rid of my PMI too and that's like $800/year I'd rather not pay!

[seriousthistime]

Do you have a Costco membership?  They have a good mortgage program with a few lenders.  I recently refi'd my townhouse (which is considered a condo for refi purposes) for 3.5%.  The Costco membership limits the upfront fees the lender can charge.  The lender fees are limited to $650 with the Goldstar membership and $350 with the Executive membership. 

In your situation, I'd refi. 

[justme]

Dec 12, 2019 8:12:15 GMT -5 seriousthistime said:

Do you have a Costco membership?  They have a good mortgage program with a few lenders.  I recently refi'd my townhouse (which is considered a condo for refi purposes) for 3.5%.  The Costco membership limits the upfront fees the lender can charge.  The lender fees are limited to $650 with the Goldstar membership and $350 with the Executive membership. 

In your situation, I'd refi. 

Wow! I had no idea. I will definitely check them out. And, uh, who wouldn't pay $60 to upgrade to Executive to save $350? And you get your $60 back if you didn't buy enough to get $60 rebated. Kind of a duh!


Wow. They're showing rates at 5.5%! I wonder if they keep the fees low but jack up the rates. 

[CCL]

Whoa! 5.5% is high. I'm refinancing mine at 3.5 for $300 closing costs.

[seriousthistime]

Dec 12, 2019 9:49:22 GMT -5 justme said:

Dec 12, 2019 8:12:15 GMT -5 seriousthistime said:

Do you have a Costco membership?  They have a good mortgage program with a few lenders.  I recently refi'd my townhouse (which is considered a condo for refi purposes) for 3.5%.  The Costco membership limits the upfront fees the lender can charge.  The lender fees are limited to $650 with the Goldstar membership and $350 with the Executive membership. 

In your situation, I'd refi. 

Wow! I had no idea. I will definitely check them out. And, uh, who wouldn't pay $60 to upgrade to Executive to save $350? And you get your $60 back if you didn't buy enough to get $60 rebated. Kind of a duh!


Wow. They're showing rates at 5.5%! I wonder if they keep the fees low but jack up the rates. 

Did you check rates through the Costco website? They make you fill in your membership number before you can get any accurate info on their mortgage program. 

[justme]

Oh- getting serious!! Would love some help. 

So there's one company that's like a "benefit" or something my work offers. His numbers are better than Chase, which I checked with. I just found out Ally does refi and while their interest rates are similar to the company guy, I think the company guy has less in fees/points or closing costs because his monthly payment was quite a bit less than what Ally was showing me. I applied with a credit union too that I need to call back with.


So is there anything I really need to look at more than just the payment? I'm not sure totally about points and fees and if they're better or not and I guess I need to account for closing costs too?

And then is there "too far" to go while you're looking at rates? Ally is asking for more info to lock in my rate. The company guy wants all the statements and such for the same reason I guess. 

[Deleted]

Jan 17, 2020 12:06:21 GMT -5 justme said:

So is there anything I really need to look at more than just the payment? I'm not sure totally about points and fees and if they're better or not and I guess I need to account for closing costs too?

I assume they've all built in the same repayment term so you're not getting quoted a lower payment because one is a 15-year loan instead of a 10-year loan.  Check on whether or not there are penalties if your prepay- e.g., if you sell the place before the loan is up.  Finally, are the rates variable?  How frequently do they adjust?

[justme]

Jan 17, 2020 12:13:46 GMT -5 @athena53 said:

Jan 17, 2020 12:06:21 GMT -5 justme said:

So is there anything I really need to look at more than just the payment? I'm not sure totally about points and fees and if they're better or not and I guess I need to account for closing costs too?

I assume they've all built in the same repayment term so you're not getting quoted a lower payment because one is a 15-year loan instead of a 10-year loan.  Check on whether or not there are penalties if your prepay- e.g., if you sell the place before the loan is up.  Finally, are the rates variable?  How frequently do they adjust?

All the ones I'm looking at are 30 year fixed rate. Trying to lower the length just increased the payment a lot. I'd prefer not to increase it much, if any. But the guy and Ally are both getting me rates just under 4% compared to 4.49% that I have and $66 of PMI that's going away. Those two are how I can take out $20k and still have a slightly lower payment. It means I'll have to grab the other $10k from my savings, but taking the full $30k out of my equity meant a higher rate and payments being slightly higher. Given the interest I'd pay on that last $10k I think it makes the most sense to just take it out of savings and repay myself with the lower payment and savings. 

[justme]

Dec 12, 2019 18:57:26 GMT -5 seriousthistime said:

Dec 12, 2019 9:49:22 GMT -5 justme said:

Wow! I had no idea. I will definitely check them out. And, uh, who wouldn't pay $60 to upgrade to Executive to save $350? And you get your $60 back if you didn't buy enough to get $60 rebated. Kind of a duh!


Wow. They're showing rates at 5.5%! I wonder if they keep the fees low but jack up the rates. 

Did you check rates through the Costco website? They make you fill in your membership number before you can get any accurate info on their mortgage program. 

Yeah, they were still showing rates over 4% basically what I am now whereas I have 2 others that got me one just under 4%. So I haven't at the moment pulled the trigger on letting those company call me. 

[justme]

So how have I missed with all of the posts on here that a refi takes pretty much as long as the original loan!??!?! Thank god my parents have the ability to float the assessment for me as I likely will get the money a week after I need it. 


Does anyone have an ideas on when a "safe" time is to think we'll get the refi? We're thinking that as long as my appraisal comes in at the number needed that we're pretty much good to go.


My employer has some benefit deal with a mortgage broker and he ended up being the best price of the ~5 places I looked at. Beat everyone by 0.25% without having to pay any points. Has a couple hundred more in closing costs, but that pales in the savings of the lower interest rate. And it's 0.5% lower than my current rate!!

Assuming things shake out the way it looks I'll actually have a monthly payment of more than $50 less! Though this will take around $12k out of my savings. I still think it's better because the payment plan as far as we can tell (and the HOA can't give us a yes yet so I'm positive that means NO) there's no incentive to pay off the payment plan early - you'll still owe 100% of the money. 

[justme]

Ok, so one of the credit unions I had looked at called me and I mentioned I was getting a lower rate elsewhere so I was going to go with that. She then asked for the loan estimate and this is what she got back to me with:


Pricing may change slightly as we don’t lock the rate until we receive the appraisal back. But, based on today’s rates I can get very close at 4% for $195 in points. I see they aren’t charging points but they are charging a separate processing and underwriting fee totaling $1,100 where ours is $750. I also see they are giving a lender credit of $381 which covers the difference between the underwriting and processing difference but… by financing with a credit union you would not be paying intangible taxes on the transaction which would be about a $312 savings. If we take the cost of the buy down of the points you are coming ahead by about $85 by financing with MIDFLORIDA.



Additionally, all the underwriting and processing is local and we would retain the servicing on your mortgage so you would always make your payments to MIDFLORIDA.


So it seems It could be a little cheaper on the closing costs if I go with them. For only 0.01% more in interest. I honestly have no idea how good/bad this is. 


I still can't figure out why Midflorida results in $3k less in cash back to me even though the loan of the other guy is only $1000 more than the midflorida one. 

[CCL]

Have you tried Googling a loan comparison calculator? That might give you a better idea where the money is going and how much it actually will cost you.

I just refinanced my house. It actually took longer than it did when we bought the place. 3 wks to buy and 6 wks to refinance, although Thanksgiving, Christmas and New Years all were within that time.

Are you doing a cash-out refi? I'm sure they charge a bit more for those.

[raeoflyte]

If the appraisal is ordered, check to see if it can be put on hold until you know if it will transfer between companies if you switch.

[justme]

Jan 22, 2020 7:42:32 GMT -5 raeoflyte said:

If the appraisal is ordered, check to see if it can be put on hold until you know if it will transfer between companies if you switch.

I gave them the info but haven't been contacted by anyone yet regarding it.

Though I'm not sure anyone is a better option. 

[justme]

3.99% with around 6k in closing is better than 4.35% and 0 in closing right? It equates to around $12k more in interest. The higher interest rate did have around $1000 more in cash back to me right now.

[raeoflyte]

How many years to break even on that 6k? And how long do you plan to live there?

[CCL]

Jan 22, 2020 13:29:16 GMT -5 justme said:

3.99% with around 6k in closing is better than 4.35% and 0 in closing right? It equates to around $12k more in interest. The higher interest rate did have around $1000 more in cash back to me right now.

That seems like a lot of money in closing costs to me. I've never paid anything close to that. The most I've ever paid was probably $1200.

Don't forget you will also probably have prepaids, escrow, etc to pay at closing. Then the next month you may not have a payment due. It all depends on what date you close and the loan terms.

[Tiny]

Jan 22, 2020 13:29:16 GMT -5 justme said:

3.99% with around 6k in closing is better than 4.35% and 0 in closing right? It equates to around $12k more in interest. The higher interest rate did have around $1000 more in cash back to me right now.

What are you getting for that 6K?

I closed on a house about 5 months ago and had "Closing costs" of about 6K - 3K of that was escrow for insurances/property taxes for the year, the other 3K ish was for things like the appraisal, the survey, and a wind and elevation? survey documents and there was something else in there I can't remember what... then the cost of the "mortgage". I think the cost of the actual mortgage was about $1500.00.

If the 6K is just to do the mortgage that seems really really expensive.

[justme]

Jan 22, 2020 18:25:03 GMT -5 Tiny said:

Jan 22, 2020 13:29:16 GMT -5 justme said:

3.99% with around 6k in closing is better than 4.35% and 0 in closing right? It equates to around $12k more in interest. The higher interest rate did have around $1000 more in cash back to me right now.

What are you getting for that 6K?

I closed on a house about 5 months ago and had "Closing costs" of about 6K - 3K of that was escrow for insurances/property taxes for the year, the other 3K ish was for things like the appraisal, the survey, and a wind and elevation? survey documents and there was something else in there I can't remember what... then the cost of the "mortgage". I think the cost of the actual mortgage was about $1500.00.

If the 6K is just to do the mortgage that seems really really expensive.

Escrow is around 1500. The rest is taxes, fees, hoa verifying crap, etc. Besides the no closing cost place the rest of the places are within around 500 of each other. But it seems like the no closing just gets the money by higher rates. He originally quoted 4.85% and only offer to try and match when I laughed and said that's way higher than any rate I've gotten. Even the lower rate is 0.10% higher than my next highest rate.

[justme]

Jan 22, 2020 18:13:19 GMT -5 CCL said:

Jan 22, 2020 13:29:16 GMT -5 justme said:

3.99% with around 6k in closing is better than 4.35% and 0 in closing right? It equates to around $12k more in interest. The higher interest rate did have around $1000 more in cash back to me right now.

That seems like a lot of money in closing costs to me. I've never paid anything close to that. The most I've ever paid was probably $1200.

Don't forget you will also probably have prepaids, escrow, etc to pay at closing. Then the next month you may not have a payment due. It all depends on what date you close and the loan terms.

The 6k is inclusive of that. Closing, escrow, other includes appraisal. I just lumped em together than dealing with this place is 500 more in A but 600 less than B.

At least one mentioned Florida has higher taxes/fees for something and then they have to do some stuff with the HOA.

[CCL]

So if you go with the no closing costs loan at 4.35% that's not much different than what you are paying now except for the possibility of eliminating PMI. Can't you eliminate the PMI when you reach 80% loan-to-value anyway? Are they rolling the closing costs into the loan?

For myself, I would not pay $4500 out-of-pocket in closing costs. How would the numbers look if you go with the lower rate and roll the closing costs into the loan?

What kind of rate could you get with a home equity line? Whenever I had one there were $0 closing costs and the rates were close to what I could get on a first mortgage.

I've never heard of waiting for the appraisal to lock-in the rate. I've always locked-in as soon as I made the the deal and submitted the application. It seems they do things a little differently down in Florida.

I'd make a few more phone calls and try to find a better deal.

[justme]

Jan 22, 2020 21:42:43 GMT -5 CCL said:

So if you go with the no closing costs loan at 4.35% that's not much different than what you are paying now except for the possibility of eliminating PMI. Can't you eliminate the PMI when you reach 80% loan-to-value anyway? Are they rolling the closing costs into the loan?

For myself, I would not pay $4500 out-of-pocket in closing costs. How would the numbers look if you go with the lower rate and roll the closing costs into the loan?

What kind of rate could you get with a home equity line? Whenever I had one there were $0 closing costs and the rates were close to what I could get on a first mortgage.

I've never heard of waiting for the appraisal to lock-in the rate. I've always locked-in as soon as I made the the deal and submitted the application. It seems they do things a little differently down in Florida.

I'd make a few more phone calls and try to find a better deal.

The varying rates is different companies. I have a 3.99% loan locked down but was still checking around before the appraisal since I'm waiting for them to contact me.

It's a cash out refi so no pmi as I can't be more than 80% ltv.

Technically I'm not bringing any cash to the table as it's a cash out refi. Closing costs are rolled into the loan

The 3.99 is giving me a bit over 18k to walk away with at the end of all the math.

The 4.35% will give me a bit over $20k at the end, but it is a higher rate in lieu of closing etc costs.

There is also a credit union at 4% that's a couple hundred less in closing stuff, but she will only write the loan estimate for only $15k making it to my pocket, but says that amount could be revised depending upon the appraisal.

[justme]

Oh all the loans are around 160. Some a little more some less.

[justme]

Jan 22, 2020 17:59:48 GMT -5 raeoflyte said:

How many years to break even on that 6k? And how long do you plan to live there?

Breakeven isn't the main issue. I need $30k to pay my assessment or I'm locked into paying $40k whether I move in a year or in 17 years. My current interest rate is also 4.49% and I'm paying PMI. So with the 3.99% offer my payment is actually around $80 less a month. 

[raeoflyte]

I meant break even between the 2 Refis and do you think that tine period makes sense.

[CCL]

If those 2 choices are the best you can get, I'd go with the 3.99%.

You don't really have a lot of options, so I'd go with the one that's going to save money every month. At least you will be getting that benefit out of the deal.