@madnutz wrote:
Hello, My lender that got me my loan reached out ot me recently with an option to refinance my loan, according to the numbers they sent me it would save me about 200 bucks a month here are my details
-Original loan started in october of 2013, so I have only had the loan for about a year
-Loan is an FHA loan and I only put down 3%(wish I could do a conventional loan but needed a home and coudn't do 20%)
-interest rate for loan is currently at 4.25%
-New loan terms according to lender documents would be at 3.75%
They sent me some document that list proposal of new terms such as new interest rate, all the fees associated with the refinance etc... would drop my payment from 1600 to about 1400 and change, anything I should look out for? Suggestions? I feel like it's too good to be true lol any advice is apprecaited thanks
Be careful here. It is common for some lenders/mortgage brokers etc to send out attractive terms, but then when you actually make application either the rate is higher or the closing costs increase or both.
You will want the lender to provide in writing your specific actual terms so you have a good comparison tool. This could be a GFE or a informal closing costs worksheet (usually done prior to application).
Right now if you make application after Jan 26 the FHA mortgage insurance is significantly less than it is today.
Also, if you refi, look up other lenders to compare your rate and your costs. Compare in writing - not just verbal.
Check the value of your property. It has been over a year and in some markets the value of properties has risen substantially. Get a free market analysis from a trusted Realtor so you know going in an approx value. Naturally the lender will have to get another appraisal. You might even be able to get your LTV under 90% which would mean that the MI would drop off after 11 years. Make sure you inquire about that.
I really don't know if these fees are normal or if they are just adding stuff... Here is what the paper work says
