Does it make sense for me to refinance?

[Anonymous]

We bought our house in 2014 with a VA loan at 3.75% and a $600K mortgage. I can refinance at no cost (no points, credit from lender that will cover the VA funding fee and all closing costs) at 3.25%. We might actually gain a few hundred bucks through the escrow refund. This would save us about $150 a month.

Seems like a win to me with the only drawback being the mortgage will be extended out another year and change. Of course, we could take the savings and pay the mortgage down faster too.

Am I missing anything here?

[Anonymous]

how long will you be there

it's not true that there are no costs. they're just hidden or built into the new rate.

[Anonymous]

Where are you finding 3.25 on a 30 year refi? Interested in doing the same. We qualify for VA.

[Anonymous]

Anonymous wrote:how long will you be there

it's not true that there are no costs. they're just hidden or built into the new rate.

I mean at no cost to me. My rate now is 3.75% and the new rate is 3.25%. I pay nothing out of pocket and there are no costs rolled into the loan.

We'll be here for a long time.

[Anonymous]

Anonymous wrote:Where are you finding 3.25 on a 30 year refi? Interested in doing the same. We qualify for VA.

OP here. Amerisave. Make sure to do the IRRRL loan because the VA funding fee is significantly less than your initial loan.

[Anonymous]

Have similar refis with amerisave 3 or 4 times when rates were dropping (finally ended up with a 10 year loan at 2.75 so I think thats it for us). Totally worth it (just be prepared to give them all your docs and to schedule an appraisal within 24 hours).

[Anonymous]

Anonymous wrote:Have similar refis with amerisave 3 or 4 times when rates were dropping (finally ended up with a 10 year loan at 2.75 so I think thats it for us). Totally worth it (just be prepared to give them all your docs and to schedule an appraisal within 24 hours).

Apparently VA IRRRL loans are streamline refinances so even the doc portion is easy.

[Anonymous]

Anonymous wrote:Have similar refis with amerisave 3 or 4 times when rates were dropping (finally ended up with a 10 year loan at 2.75 so I think thats it for us). Totally worth it (just be prepared to give them all your docs and to schedule an appraisal within 24 hours).

The OP mentioned it was IRRRL - so there is no appraisal involved.

[Anonymous]

OP again. Can someone talk to me about how the lender credit works? I just checked this morning and the lender credit is now $7.2K! I mean, obviously it can be used to cover the funding fee and closing costs. How much of the escrow (taxes and insurance) can it fund? Can it fund the escrow for the whole year? If so, we'd walk away with at least $1,000 profit from this and a lower rate.

[Anonymous]

I did something similar with a no-cost loan from Eagle Bank when my loan was six months old. I cut a couple hundred off my monthly payment, which was nice.

[Anonymous]

Anonymous wrote:

Anonymous wrote:how long will you be there

it's not true that there are no costs. they're just hidden or built into the new rate.

I mean at no cost to me. My rate now is 3.75% and the new rate is 3.25%. I pay nothing out of pocket and there are no costs rolled into the loan.

We'll be here for a long time.

So you are restarting your loan by getting another 30 year mortgage or are you able to refi at the length of time remaining on your current loan?

[Anonymous]

you will pay those fees etc and closing costs over time, don't fall for the gimmick

I wouldn't I would just apply more coin to the principle. each month

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:how long will you be there

it's not true that there are no costs. they're just hidden or built into the new rate.

I mean at no cost to me. My rate now is 3.75% and the new rate is 3.25%. I pay nothing out of pocket and there are no costs rolled into the loan.

We'll be here for a long time.

So you are restarting your loan by getting another 30 year mortgage or are you able to refi at the length of time remaining on your current loan?

I assume I would be restarting the loan.

[Anonymous]

Anonymous wrote:you will pay those fees etc and closing costs over time, don't fall for the gimmick

I wouldn't I would just apply more coin to the principle. each month

I don't understand what you mean. If the interest rate decreases and the principal amount stay the same (i.e. no fees are being rolled back into the loan) and I am not paying any closing costs due to the lender credit how am I paying these costs over time? Obviously, if I were not to get the lender credit I could conceivably get a lower rate but the proper comparison is the interest rate I'm paying now to what I could have if I refi right?

[Anonymous]

When we refinance I make sure we make Yemenis the still mean we will finish 30 years 9or earlier) than our original loan. Otherwise, if you constantly refinance you are paying more and more into the future. People often just look at the amount their monthly rate goes down and don't count the additional months/years tacked on at the end.