quote:

Originally posted by 1s1k:

quote:

Originally posted by jimmy123x:
Because a lot of times, someone that's been in a 3.5% mortgage for 4.5 years is better off staying, rather than switching to another 30 year mortgage at 2.5% plus all of the closing costs added in. Putting it out there for the people that keep refinancing every 6-18 months for a better rate, but don't realize what the closing costs are, the extra months of interest they're adding, and think they're moving forward but when you sit down and do the math, actually going backwards. It's real easy to do the math. Multiply the number of existing remaining payments by amount.......then do the same with the new mortgage......

People can't help themselves and end up pulling money out and often times not knocking any years off their loan because it feels like free money. Do it if you can drop years off your payment, you will be thanking yourself when you send in that last payment.

YUP, winner winner chicken dinner. I see it over and over again!

quote:

Originally posted by 1s1k:

quote:

Originally posted by jimmy123x:
Because a lot of times, someone that's been in a 3.5% mortgage for 4.5 years is better off staying, rather than switching to another 30 year mortgage at 2.5% plus all of the closing costs added in. Putting it out there for the people that keep refinancing every 6-18 months for a better rate, but don't realize what the closing costs are, the extra months of interest they're adding, and think they're moving forward but when you sit down and do the math, actually going backwards. It's real easy to do the math. Multiply the number of existing remaining payments by amount.......then do the same with the new mortgage......

People can't help themselves and end up pulling money out and often times not knocking any years off their loan because it feels like free money. Do it if you can drop years off your payment, you will be thanking yourself when you send in that last payment.

If I could talk to my younger self, I would tell him to never get a 30 year mortgage. 15 or 20 is the way to go.

quote:

Originally posted by sasquatch28:

If I could talk to my younger self, I would tell him to never get a 30 year mortgage. 15 or 20 is the way to go.

While I don't disagree with the sentiment, originating a 20 year mortgage is rarely beneficial, because the product prices off the 30 year mortgage. Historically (30 years or so), the 20 year mortgage has priced less than 1/4% below the 30 year, which on a $200,00 mortgage will get you a whopping $15.19 a month (when you compare a 240 month amortization). So, you could save $181 dollars a year, but if something happens, and you have a 30 year mortgage and you need $240, you could drop your payment down to the required amount for a month.

The 15 year mortgage prices significantly better than the 30 year - historically between 5/8 and 1%. If you are considering shortening your term, and are dedicated in paying it off earlier, 15 year mortgages are a far better priced option as compared to a 20 year.

Never say never.

My 30 year USDA interest rate is lower than a conventional 15 year interest rate.

Plus, it means I can put extra towards principal, yet have the flexibility to just pay the base some months if something comes up where that extra money is needed.

quote:

Originally posted by RogueJSK:


Plus, it means I can put extra towards principal, yet have the flexibility to just pay the base some months if something comes up where that extra money is needed.

This is my thinking as well.

quote:

Originally posted by RogueJSK:
Never say never.

My 30 year USDA interest rate is lower than a conventional 15 year interest rate.

Plus, it means I can put extra towards principal, yet have the flexibility to just pay the base some months if something comes up where that extra money is needed.

Don't read this as me being a dick - I am just trying to clarify for people before they run out asking for a USDA loan.

Comparing a USDA subsidized mortgage with very thin criteria to a traditional mortgage is not an apples to apples comparison.

In order to get a Section 502 loan you must be in a rural (sub 20,000 population area), have a lower than typical debt to income ratio, in areas that are considered "economically challenged", and have to fall under an income caps based on a % of local median salary. While 95% of the Country's location meets part of these qualifications, less than 10% of the population meets all of the criteria.

Oh, I know. I'm very lucky to hit the "perfect storm" of meeting all the USDA RD criteria while also getting the lowest interest rates in history.

I was just pointing out one example of where an overly broad blanket statement of "30 year mortgage = always bad" is not accurate.

I'm sure there are others too.

quote:

Originally posted by RogueJSK:
Oh, I know. I'm very lucky to hit the "perfect storm" of meeting all the USDA RD criteria while also getting the lowest interest rates in history.

I was just pointing out one example of where an overly broad blanket statement of "30 year mortgage = always bad" is not accurate.

I'm sure there are others too.

Totally agree! Congrats on the house and an absolutely killer rate.

quote:

Originally posted by 280nosler:

quote:

Originally posted by sasquatch28:

If I could talk to my younger self, I would tell him to never get a 30 year mortgage. 15 or 20 is the way to go.

While I don't disagree with the sentiment, originating a 20 year mortgage is rarely beneficial, because the product prices off the 30 year mortgage. Historically (30 years or so), the 20 year mortgage has priced less than 1/4% below the 30 year, which on a $200,00 mortgage will get you a whopping $15.19 a month (when you compare a 240 month amortization). So, you could save $181 dollars a year, but if something happens, and you have a 30 year mortgage and you need $240, you could drop your payment down to the required amount for a month.

The 15 year mortgage prices significantly better than the 30 year - historically between 5/8 and 1%. If you are considering shortening your term, and are dedicated in paying it off earlier, 15 year mortgages are a far better priced option as compared to a 20 year.

Oh, I was not arguing the financial aspects. The psychological aspects of slogging through a 30 year note are tough for me. With a 15 or a 20, you feel like you are making progress.

I locked in at 2.5% on a 15 year. Bought 1/2 a point.

I've used Union Savings Bank for the original mortgage on my house and every re-fi for the last 19 years.

In January I got 3.0% on a 15 year with net origination fees of around $250. They are no frills (very no frills) and they comp most of the fees.

Before that I had a 20 year at 4.25% from a year ago.

Before that a 5/1 ARM (30 year amortization) at 3.5% that was going to get jacked up 2 points after year 5. I got that loan in early 2014 after getting divorced and had to take money out to pay my ex her equity. Fixed rate 30 was going to be 4.75% at that time I think.

Yes, the 20 year was only marginally lower than the 30 but I didn't want to extend the term of the loan further. Yeah I could have gotten a 30 and paid extra, but the lower rate does save some money.

The big banks always want $1K-2K in fees, which factors into how much you actually save. But for $250 it's a no brainer. You just need really good credit and a fully conforming loan they can sell to Fannie Mae.

Sooooo...I've been watching a particular credit union's rates...saw this morning that their rate could be as low as 2.375%. Cool...call...30+ minutes on hold...chat with nice representative, gave some of the basic requisite info, including that we want to refi into a term roughly the equivalent of what we have left on our current mortgage...

Response: Your rate will be basically about 1/8 pt. lower than what you're currently paying, plus all the fees, buying point(s), etc. And it'll take 3-4 months to close...

WTH?

Why does it seem to get the super low rate, you have to sign back up for a full 30 year mortgage?

Would be nice if the folks that had been diligently paying their mortgage for years got thrown bone too...

And fees? Seems like a lot of coin for essentially keystrokes (I get that's an oversimplified view). But, at least in my experience, the applicant is the one usually filling out alot (most) of the application, scanning and submitting alot/most the documents/info, etc.

Anyhow...well, have to explore possibilities...

Boss

Locked 2.75, no points on a 30 year fixed a couple weeks ago.

I closed on my loan back in July (2.75%, 15 year). I didn't pay any points, normal fees...credit report, county filing fees, etc... I find US Bank to be very good. I keep their feet to the fire and tell them I want the rate they advertise here:

https://www.usbank.com/home-lo.../mortgage-rates.html

quote:

Originally posted by LS1 GTO:
And it begins...

Yep. History repeats itself, repeatedly...

I'll bring this one back up as I'm see offers for VA rates at ~1.875%...

How low can they go???

Boss

I have 20 months left on my original 30 year loan that we refinanced to a 20 year on two no coast refinance loans lowering our rate each time. I'm not sure anyone would give us the time of day now with how little time we have left.

quote:

Originally posted by BB61:
I have 20 months left on my original 30 year loan that we refinanced to a 20 year on two no coast refinance loans lowering our rate each time. I'm not sure anyone would give us the time of day now with how little time we have left.

You’d probably spend more on closing costs than the interest you’ve got left.

I should probably ask the bank. I'm 7 years into a 30 which is at 3.25%. Probably not worth it since I plan to move in 2-8 years whenever i retire.

quote:

Originally posted by Boss1:
I'll bring this one back up as I'm see offers for VA rates at ~1.875%...

How low can they go???

Boss

Damn, that's very good! I just financed my house with a VA loan (closed on Nov 25th) and got 2.5%. I thought I did really well but that's even better!