TheHaitian
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Post by TheHaitian on Jul 7, 2020 23:45:49 GMT -5
I asked in another forum but figure it cannot hurt to ask here also ...
The notary came this morning and we signed all the refinance paper work and uploaded all the documents we needed to upload online.
So home was valued at $630,00 and the new loan amount is $502,000 and our monthly payment is $2,714 down from $3,315 (bye bye PMI), so a savings of $600.00/month
Question 1:
From what I understand I should be getting some of my escrow balance back from my old mortgage holder. Currently it is $3652.81
-> half of my property taxes are due in August : $2,128
-> Home insurance is due in August : $1,353
-> yet with my new loan they charged me in the closings costs 6 months of homeowners insurance at $1,044 (which is higher than what I pay) and 6 months of property taxes $2,120
---> Just trying to figure if my new company is going to pay it or my old company going to pay it or should I pay it? trying to make sure the transition is smooth, and if I should be expecting a refund from my first loan company? Should I contact someone come August?
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Question 2
Second part it seems between the loan amount - the closing costs - total payoffs = there is a total difference of $2,440 which is cash to borrower. We were not expecting that, we did not do cash refinance (duh such a small amount) so was a bit surprised. I wonder why they did not just lower our mortgage principal by that amount / money they are lending us vs giving us cash back.
First time we are refinancing so not sure and they notary was just there to watch us sign and could not answer that question. I will take that money and throw it at our debt for sure but just wondering. I can always call my mortgage guy and ask him...
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Question 3
My mortgage balance is 8k less than what on paper they are saying they will be paying the bank. My balance is $475,999.38 yet on the paperwork I signed the estimated payoff used is $484,192. So $8,192.62 ... I know between balance and payoff balance there is usually a difference but 8k seems pretty big to me. I called the bank this morning to get my exact payoff balance but I was on hold for over 20 minutes so give up.
I do know when I applied I said my mortgage was $480,000 so not sure if he went off that or something. So should I expect the difference between the two back as a refund from WF?
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tskeeter
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Post by tskeeter on Jul 8, 2020 2:50:54 GMT -5
Your new lender should handle the property taxes and insurance.
The cash to borrower is probably the refund of prorated taxes and insurance. You should be able to tell if you look at the detail of your closing statement.
No idea why the large discrepancy between your mortgage balance and the estimated payoff. I agree it seems high.
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raeoflyte
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Post by raeoflyte on Jul 8, 2020 7:19:36 GMT -5
Ask your lender for a copy of the payoff they are using.
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Knee Deep in Water Chloe
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Post by Knee Deep in Water Chloe on Jul 8, 2020 10:43:45 GMT -5
I haven't had enough coffee to process your questions. I just wanted to say I'm super excited for you getting rid of the PMI and saving $600/month on that expense.
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bean29
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Post by bean29 on Jul 8, 2020 10:52:27 GMT -5
Congrats on the $600 a month savings. I am thinking the $2440 cash back to borrower is the refund of the escrow they forced you to re-escrow. I would assume the new lender is to pay the taxes. I don't know who will pay the insurance - but if you don't have proof of coverage, they will force their coverage on you and it is much more expensive than what you buy - which is prob why they don't care if it gets paid or not.
I have never refinanced and not have had them confirm a payoff. I would question the lender on the discrepancy on the payoff amount.
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haapai
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Post by haapai on Jul 8, 2020 13:06:47 GMT -5
Escrow amounts must be calculated differently in your state than my own. I'd land up having to create a new escrow account that was at least the amount that was due in August plus a couple of months of buffer.
The escrow amount that they are listing seems strangely low.
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justme
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Post by justme on Jul 8, 2020 13:30:45 GMT -5
So it depends on when they payoff your mortgage. Your paperwork should have the date. Mine was a few days after I signed. If the old mortgage company is paid off before your mortgage is due than it'll be the new one, but that's a REALLY close time frame so I would keep a watch on that to make sure it's paid.
It sounds like you might be having a catch up escrow payment since it doesn't seem like they'll get enough to pay in August.
Are you sure the cash to borrower isn't your escrow payment? You should have a breakdown of where everything goes.
The payoff is always more than your balance. It includes all the interest (did you pay a July payment to the current mortgage company? If not the payoff added in all of the interest from June plus the interest of July until probably the 15th) plus the PMI payment up until the payoff date (ie it'll be a full PMI payment at least) and there might be some other stuff in there too.
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TheHaitian
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Post by TheHaitian on Jul 8, 2020 14:04:00 GMT -5
So it depends on when they payoff your mortgage. Your paperwork should have the date. Mine was a few days after I signed. If the old mortgage company is paid off before your mortgage is due than it'll be the new one, but that's a REALLY close time frame so I would keep a watch on that to make sure it's paid. It sounds like you might be having a catch up escrow payment since it doesn't seem like they'll get enough to pay in August. Are you sure the cash to borrower isn't your escrow payment? You should have a breakdown of where everything goes. The payoff is always more than your balance. It includes all the interest (did you pay a July payment to the current mortgage company? If not the payoff added in all of the interest from June plus the interest of July until probably the 15th) plus the PMI payment up until the payoff date (ie it'll be a full PMI payment at least) and there might be some other stuff in there too. I already paid July mortgage (on the first)... making the balance 476k. Will call the guy and see if he can clarify...
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justme
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Post by justme on Jul 8, 2020 14:08:15 GMT -5
So it depends on when they payoff your mortgage. Your paperwork should have the date. Mine was a few days after I signed. If the old mortgage company is paid off before your mortgage is due than it'll be the new one, but that's a REALLY close time frame so I would keep a watch on that to make sure it's paid. It sounds like you might be having a catch up escrow payment since it doesn't seem like they'll get enough to pay in August. Are you sure the cash to borrower isn't your escrow payment? You should have a breakdown of where everything goes. The payoff is always more than your balance. It includes all the interest (did you pay a July payment to the current mortgage company? If not the payoff added in all of the interest from June plus the interest of July until probably the 15th) plus the PMI payment up until the payoff date (ie it'll be a full PMI payment at least) and there might be some other stuff in there too. I already paid July mortgage (on the first)... making the balance 476k. Will call the guy and see if he can clarify... Did they tell you to make the July payment?
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haapai
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Post by haapai on Jul 8, 2020 14:11:58 GMT -5
It sounds like what you signed was an estimate, not a HUD-1. When is your closing scheduled? You should be supplied a HUD-1 settlement statement three days prior to closing.
I would expect your HUD-1 to look quite different from what you have described. The level to which you will have to prime the escrow account may be much higher than what you have described or it may be much lower depending on how the homeowners' insurance and August tax payments are handled. There's a chance that you will have to pay homeowners' out of pocket and bring proof of that payment to the closing. There's also a possibility that payment of the August taxes will become the responsibility of the title company.
FWIW, It would not surprise me much if the amount that you need to prime the escrow account with is much higher than the existing balance even though you will no longer have to pay PMI. The same goes for the highest balance that your new escrow account will reach.
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TheHaitian
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Post by TheHaitian on Jul 8, 2020 14:17:17 GMT -5
It sounds like what you signed was an estimate, not a HUD-1. When is your closing scheduled? You should be supplied a HUD-1 settlement statement three days prior to closing.
I would expect your HUD-1 to look quite different from what you have described. The level to which you will have to prime the escrow account may be much higher than what you have described or it may be much lower depending on how the homeowners' insurance and August tax payments are handled. There's a chance that you will have to pay homeowners' out of pocket and bring proof of that payment to the closing. There's also a possibility that payment of the August taxes will become the responsibility of the title company.
FWIW, It would not surprise me much if the amount that you need to prime the escrow account with is much higher than the existing balance even though you will no longer have to pay PMI. The same goes for the highest balance that your new escrow account will reach.
Just got off the phone with the mortgage guy and you are correct. The cash back to borrower will be used to fund the escrow account to have enough to pay the property taxes. As for the mortgage payoff they just guessed it based on what was on my credit report but awaiting a final # from my current mortgage lender. So my actual loan may be less than 502k. He said it is easier to reduce the loan amount after getting all the final numbers vs going in and requesting it to be increased 🤷🏾♂️.
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haapai
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Post by haapai on Jul 8, 2020 15:29:50 GMT -5
This might be a good time to dig out your last HUD-1 and your last escrow account statement and study them a bit. It sounds to me like there is a distinct possibility that you will have to bring a couple hundred dollars (maybe a grand) to the closing.
There's also a good possibility that your existing mortgage servicer will pay the homeowners' insurance and/or property taxes even though the HUD-1 form indicates that they are not responsible for these payments. This can create interesting headaches, especially if the servicer pays first and cannot get a refund directly from the taxing authority.
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Bonny
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Post by Bonny on Jul 9, 2020 10:16:49 GMT -5
I haven't had enough coffee to process your questions. I just wanted to say I'm super excited for you getting rid of the PMI and saving $600/month on that expense. Technically he's not really "saving" $600/mth. His payment is lower through a combination of re-amortization of the new loan balance, lower interest rate and getting rid of PMI. I always correct my loan agent with s/he makes a statement like this. If TheHaitian has a goal of having the loan paid off at X (say 65) he should either invest a portion of his lower payment to a "loan payoff line item or apply a portion of the lower payment to the loan principal. Most people will up their spending.
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vonna
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Post by vonna on Jul 9, 2020 14:44:54 GMT -5
Well, though Bonny is right (party-pooper!) I am not-very-YM on this one. We have used refinancing in the past as a means to make it easier to meet our long term goals. I can see why TheHaitian calls it a savings of $600 per month! By refinancing and bringing down our mortgage payment, it gave us more breathing room. We were able to continue to max out our retirement accounts, fund 529's etc and have more money in the monthly budget for extras.
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TheHaitian
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Post by TheHaitian on Jul 10, 2020 7:24:29 GMT -5
I haven't had enough coffee to process your questions. I just wanted to say I'm super excited for you getting rid of the PMI and saving $600/month on that expense. Technically he's not really "saving" $600/mth. His payment is lower through a combination of re-amortization of the new loan balance, lower interest rate and getting rid of PMI. I always correct my loan agent with s/he makes a statement like this. If TheHaitian has a goal of having the loan paid off at X (say 65) he should either invest a portion of his lower payment to a "loan payoff line item or apply a portion of the lower payment to the loan principal. Most people will up their spending. Meh, I will still count is savings since part of that is $438 in PMI that to me was useless. Yes, it was going to the government to guarantee the loan to the bank but it was useless to me and my bottom line. So I will take it now and apply it on what can benefit me financially in the long run.
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Bonny
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Post by Bonny on Jul 10, 2020 14:42:47 GMT -5
Technically he's not really "saving" $600/mth. His payment is lower through a combination of re-amortization of the new loan balance, lower interest rate and getting rid of PMI. I always correct my loan agent with s/he makes a statement like this. If TheHaitian has a goal of having the loan paid off at X (say 65) he should either invest a portion of his lower payment to a "loan payoff line item or apply a portion of the lower payment to the loan principal. Most people will up their spending. Meh, I will still count is savings since part of that is $438 in PMI that to me was useless. Yes, it was going to the government to guarantee the loan to the bank but it was useless to me and my bottom line. So I will take it now and apply it on what can benefit me financially in the long run. Wow, that's a big PMI payment! How big was the loan? You definitely did the right thing getting rid of it. How long had you had the loan?
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TheHaitian
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Post by TheHaitian on Jul 10, 2020 15:01:28 GMT -5
Meh, I will still count is savings since part of that is $438 in PMI that to me was useless. Yes, it was going to the government to guarantee the loan to the bank but it was useless to me and my bottom line. So I will take it now and apply it on what can benefit me financially in the long run. Wow, that's a big PMI payment! How big was the loan? You definitely did the right thing getting rid of it. How long had you had the loan? Original Loan was for $522,000 (Jumbo Loan) and had it for 4 years (August 2016)
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TheHaitian
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Post by TheHaitian on Jul 16, 2020 10:06:07 GMT -5
I am supposed to close either the first week or second week of August per new company. From what I gathered getting paying amount from Wells Fargo is that I do not need to make an August payment since “technically” I should close/refinance before 8/15 deadline.
Payoff amount detail as of 8/14 (Friday) per the letter the bank sent me (I requested an official payoff amount that was faxed to me): Loan $476,000 Payoff amount $479,330.11 —> unpaid principal : $1,981.70 —> interest as of 8/14 : $1,316.91 —> interest accrues at the rate of $45.64/day
The real question I wanted answered was payment of property taxes and insurance. Home insurance due on 08/08 and Wells stated they will probably pay it if I don’t close till 08/14 but was unsure about property taxes.
So had to go look online on DC property taxes And it seems my taxes are not due till 09/15 so my assumption is the new company will probably pay it and I will get the escrow refunded from Wells Fargo,
Learning something new everyday....
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TheHaitian
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Post by TheHaitian on Jul 16, 2020 10:12:34 GMT -5
So technically the reason I do not have to make a “mortgage payment” is payment they include it in the mortgage payoff amount. The mortgage broker was saying that I get to go 2 months without making a Payment (August / September) and my next mortgage is not till October:
Technically it is only 1 month since August is covered by my loan payoff. Anyway plan is to send that money toward bills, I just had to send 3k to Uncle Sam and DC (filed taxes yesterday).
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bobosensei
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Post by bobosensei on Jul 16, 2020 11:45:12 GMT -5
Make sure to look at your estimated taxes for this year and adjust withholding if you itemize since that would go down with less interest payments and PMI.
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bean29
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Post by bean29 on Jul 16, 2020 15:54:06 GMT -5
So, we have our 1st and a 2nd at the local credit union. I just happened to glance at the flyer that came with our Statement, and they are offering an express refi for $89.
Current Loan 7 1/2 years left with a 2.813 interest rate
offer 10 years at 2.7% or 8 years at 2.6%
We can't take cash out, but we can roll our first and our second together and get a fixed rate for both loans. I will apply tonight or tomorrow, so we can get the second fixed. I figured it will extend the loan out about 2 years and we will keep the same approximate payment for the first, I actually have been paying $500/month on the second.
We also have an adjustable rate commercial loan that has maybe 8-9 years left on it. The payment is also about $2,000 a month and there is a mortgage on two buildings - the office for the Insurance Agency and the old office for the insurance agency - which has an apartment upstairs. My BIL is going to move in there, so we won't put it up for sale, but we were holding the building until we paid the loan down enough to mortgage one building with a 70% LTV. When the CARES Act came out, I applied for the $2,000 EIDL grant, and DH just got offered $105,000 from the SBA with an interest rate of 3.75 (no collateral) 30 year payoff - loan payment would be about $500/month. I will also discuss that with DH to see what he wants to do. Those are commercial buildings, so the terms are usually stricter. I have to look at the loan terms, existing floats a certain % about LIBOR and I think it is currently at about 4. ?% Not sure what happens if LIBOR goes negative, of if LIBOR can go negative.
ETA we owe about $120,000 on the two buildings so we would need to come up with about 15,000 but because we got the CARES $$, DH has the $$ sitting in his account RN.
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Deleted
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Post by Deleted on Jul 16, 2020 20:26:11 GMT -5
So, we have our 1st and a 2nd at the local credit union. I just happened to glance at the flyer that came with our Statement, and they are offering an express refi for $89. Well, WTH? How come offers like that don't just fall in my lap. I've been talking to mortgage people galore and can't get anything remotely close to that. $700 on a rapid refi is the best I can do. I think my state has a lot of mandatory fees on refinances.
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bean29
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Post by bean29 on Jul 17, 2020 7:00:16 GMT -5
MPL are you trying to just refi your first mortgage or do you also have a second? This is a great deal. We have first and second with the same credit union. They actually don’t have much work to do because very little changes. They already have lien against the property and they pretty much know my house is worth more because 8 years ago we owed about double what we do now. They don’t do a fill blown appraisal. They have a realtor do some type of valuation but it is pretty worthless imho.
Couldn’t get into app last night. My firewall blocked it. Will try from work today. Talked to DH and we are going to take the other loan to pay off the commercial loans and keep paying same payment.
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Post by Deleted on Jul 17, 2020 10:58:03 GMT -5
MPL are you trying to just refi your first mortgage or do you also have a second? I have a HELOC as well with the same CU, but it has a zero balance right now. There are some fees in MN they have to pay no matter what like transfer taxes and recording fees.
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bean29
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Post by bean29 on Jul 21, 2020 15:57:50 GMT -5
So, I heard back from the bank - they want me to explain 4 credit inquiries - 3 from them? IDK maybe you wanted to peek at my credit b/c I want to refinance? The other is from the SBA - because I applied for EIDL and they came back and offered me enough to refinance the Business Mortgage. I can explain that too.
Then there is a whole long list of variations of our names and an Alias SS # ending 1234 idk - give me some more info and maybe I can figure out something but, does not appear to be anything to do with me, DH, DD or DS.
Bean's Husband Birth Name, Mother's Maiden first initial, Last name (Birth Name) Bean's Husband's American First Name, Birth First Name, Last name (Name change from about 5 years ago, which CU should have on file) Birth First Name, First 3 of last nameBirth First Name, Last Name (idk someoen messed up) Bean's Husband's Birth First Name, Bean's Birth Last Name (This happens b/c I carry health insurance and I have a different last name) American First Name Birth First Name-Last Name (idk someone made it up) Last Name, Birth First Name First Name repeated (again, idk someone messed up) Bean's birth First name, middle initial, last name Bean's Mother's full middle name, with Last Name misspelled Bean's Mother's middle name, Last name - cause at one point she co-signed for a loan for me like 30 years ago, idk.
I really don't know how we should be expected to explain an alias SS # with no further info - like is there an account associated with it, city state - why did it get associated with us, neither of our SS#'s is even close.
It is funny that there are so many variations of DH's name and not a long list for me - over the years my name gets mangled all the time b/c I hyphenated it. But really - I find it hard to believe that other people don't have this too. When we got our first mortgage my MIL's info appeared on our credit report - so their mortgage showed up under DH's credit report.
ETA: Can someone remind me where to go to get a copy of my "Free Credit Report" you know the one that is really free? The bank just asked about the alias SS# and did not offer me a credit report to review. They are also asking for a $400+ processing fee - I sent them back a note and asked what happened to the $89 fee I had previously discussed with someone else.
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TheOtherMe
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Post by TheOtherMe on Jul 21, 2020 16:35:05 GMT -5
bean29 annualcreditreport.com Report is free, but it costs to get your credit score. On the banner, it says because of covid, the credit report can be accessed weekly.
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Post by Deleted on Jul 21, 2020 19:24:51 GMT -5
They are also asking for a $400+ processing fee - I sent them back a note and asked what happened to the $89 fee I had previously discussed with someone else. Did you get the, "Well, WE'RE only charging $89, but we still have to collect X, Y and Z for these other folks". That's what I run into....
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bean29
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Post by bean29 on Jul 22, 2020 22:16:49 GMT -5
The guy called me back and said that I applied for the wrong loan, apparently I should have applied for a home equity loan even though it is really a first mortgage. Apparently the loan is handled within the branch instead of as a mortgage or something like that. He is transferring it to the right people. I think they don't bother with the appraisal - my house is worth about 350,000-450,000 and the payoff is about $160,000. They also don't need to file with the state, as they already have 1st mortgage lien on the property. I was hoping he e-mailed me the full credit report, but it is just the last page. It is 10pm already, so I guess I won't try to get the free credit report version tonight. If I talk to the new processor tomorrow, maybe I can get them to give me the full report. We got the approval for the EIDL loan. DH e-signed the documents and the funds should be deposited to his bank account. He mentioned that if we run into issues with them we can always re-mortgage the property. That was easy. DH was completely on board, but he forwarded it to me, and I looked at it, called him and suggested how we use it, and he was all over it. He does not do paper work though. I have to figure out how to set him up if I go before he retires b/c it will be a cluster.
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TheOtherMe
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Post by TheOtherMe on Jul 23, 2020 6:41:38 GMT -5
A lien was filed on my HELOC. It won't be released until I close the HELOC even though the balance is zero. It has to stay open for 3 years or I have to pay a fee, so it stays open.
Credit union said because my house according to the tax assessment was not the correct Loan to Value, they needed to do an appraisal. He had looked at Zillow (the only site that is used here) so he knew it would appraise at a high enough value for a HELOC. It came in even higher than Zillow.
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TheHaitian
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Post by TheHaitian on Aug 21, 2020 10:25:39 GMT -5
Ok, closing was final this morning... I should be getting ~2k back that I asked if could be applied to escrow account or if not I will just apply it to outstanding loan.
Mortgage payment will start on 10/01/2020 Going from $3,315/month to $2,630/month; so reducing my payments by $685/month... Most of that is coming from getting ride of PMI after 4 years...
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