greekelite

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With the Fed dropping 50 basis points off the current rates theres a lot of talk about refinancing, rates seeming 3.5-3.75%

I learned that my loan type (USDA) I can refi, but has to be 12 months (April 16th will be our 12 months since closing), so I may look to get the ball rolling. I'm currently at 4.5%. I wouldnt take out any equity (not really much in it, other than the appraisal valuing it more than what my balance is), just looking to lower my payments

Anyone else looking to refinance? Or even have experience having done that for those of us who are newbs?

Any info is appreciated!!
 
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Reframmellator

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My financial advisor convinced me to refinance my remaining debt into a 30 yr mortgage and then retire sooner rather than later. That was three weeks ago. I was just looking at rates and found a local bank with a 3.044% APR with no points.
 

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I was thinking about it before this happened, seriously considering it now.
 

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Yup talking to a few mortgage places as we speak. Looking like we are going to go down to a 15 year in the 2.8% to 2.9% range. Still waiting to hear back from a few others.

FYI the federal funds rate is not tied to mortgages. Mortgage rates are tied to the 10 year treasury yield which "may" have a similar pattern as the federal funds rate.

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Nate

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Yup talking to a few mortgage places as we speak. Looking like we are going to go down to a 15 year in the 2.8% to 2.9% range. Still waiting to hear back from a few others.

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Damn....might need to look into this.
 

greekelite

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My financial advisor convinced me to refinance my remaining debt into a 30 yr mortgage and then retire sooner rather than later. That was three weeks ago. I was just looking at rates and found a local bank with a 3.044% APR with no points.
Damn that's crazy good, at least based on my limited understanding.

This is what I get from my current lender, their basic e-form. Going to give them a call tomorrow and ask
Screenshot_20200303-211803_Chrome.jpg

The 2nd option would save me $175/mo based on the early estimate

I'd love to do 15 year but just wouldn't be able to swing it
 

Titleistforlife

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2.75 for 15 years here today...30 year is 3.25
 

Reframmellator

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Damn that's crazy good, at least based on my limited understanding.

This is what I get from my current lender, their basic e-form. Going to give them a call tomorrow and ask
View attachment 8930425

The 2nd option would save me $175/mo based on the early estimate

I'd love to do 15 year but just wouldn't be able to swing it
I found the best rates at two small local banks and a credit union. Roughly 1/4-1/2% lower than the big guys including the largest CU around here.
 

links_slayer

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We refinanced to a 12 year at 3.05% 14 months ago - couldn't be happier. We make payments every two weeks (more than the minimum) and should have it paid off well before the 12 years.
 

greekelite

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I found the best rates at two small local banks and a credit union. Roughly 1/4-1/2% lower than the big guys including the largest CU around here.
Hmmm I'll look for that if they can do my specific loan type. Going to a conventional would actually make the payment go up as USDA doesn't have pmi I believe
 

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We refinanced 7 years ago. A 15 year loan at 2.8%. A little less than 8 years to go.
 

NoGoal

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I refinanced 5 years ago with a 15 year fixed at 3.025% and will be mortgage free at 57 years old.
 

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We refinanced with US Banks Smart Refinance in 2015 for a 20 yr at 3.99%. No points. No fees. No closing costs. Thankfully things have fallen into place and we've been paying extra... So we will be mortgage free by May of this year.

Although I am tempted to pull out 50% of the value with a 30 yr mortgage and drop the cash into the market once I think it has settled down. Decisions decisions.

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fuffle master

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Asking the experts in this field, I have always been a fan of only having a 15 year loan. We have 12 years left at 6%. Would you keep the 15 year if refinancing when the plan is to sell in the next 3 years?
 

NoGoal

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Asking the experts in this field, I have always been a fan of only having a 15 year loan. We have 12 years left at 6%. Would you keep the 15 year if refinancing when the plan is to sell in the next 3 years?
As long as there is no points, no fees and no closing cost.
 

greekelite

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Asking the experts in this field, I have always been a fan of only having a 15 year loan. We have 12 years left at 6%. Would you keep the 15 year if refinancing when the plan is to sell in the next 3 years?
Im no expert, hence the thread, but the way I amatuerly look at it: say p&I is 1k / mo, principal left of say 150k. If refi for no fees, points, closing etc as nogoal ^ mentioned, your principal remains the same and your new p&I comes to say 900/mo.. even $100/mo could be stored away for an extra vacation a year, golf etc, or just put back into the principal so when you sell you'll get maximum cash

I don't know if that even makes sense or would happen like that, I'm not a finance person, but just kind of how I hope it could work....?
 

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Asking the experts in this field, I have always been a fan of only having a 15 year loan. We have 12 years left at 6%. Would you keep the 15 year if refinancing when the plan is to sell in the next 3 years?
OMG Yes.
You can make double payments or extra money included in payment to bring it back to 12 in no time.

We just refinanced and purchased another piece of real estate a few weeks ago because both rates were crazy low and saved hundreds each month with virtually nothing else changing.
 

tahoebum

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I helping my sister with a refinance right now as she is at 4.625% on her 30 year loan. She’s likely going with a 15 year at 2.828%. Here’s the current rates from our credit union.

Many think rates will go even lower over the next month. It's crazy that you can already get a 20 year under 3%.

EDFA3B72-A5A9-4DAC-908C-57AEE20C48EA.jpeg
 
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Jmk202

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Damn that's crazy good, at least based on my limited understanding.

This is what I get from my current lender, their basic e-form. Going to give them a call tomorrow and ask
View attachment 8930425

The 2nd option would save me $175/mo based on the early estimate

I'd love to do 15 year but just wouldn't be able to swing it
Do the 30, make sure no prepayment penalty then pay as much as you want, the extra goes toward principle. And you can pay your 30 year off in 15 if you'd like. Before someone else jumps on me, it may be more wise to use the "extra" payment for something with a higher return than these low rates.
 

Jmk202

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Asking the experts in this field, I have always been a fan of only having a 15 year loan. We have 12 years left at 6%. Would you keep the 15 year if refinancing when the plan is to sell in the next 3 years?
Not an expert, but do the math. $$$ reduced per month in your payment vs the cost of closing. That should tell you how many months it will take you to break even.
 

Reframmellator

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Do the 30, make sure no prepayment penalty then pay as much as you want, the extra goes toward principle. And you can pay your 30 year off in 15 if you'd like. Before someone else jumps on me, it may be more wise to use the "extra" payment for something with a higher return than these low rates.
My advisor advocated for the 30 yr as a retirement cash flow benefit. Unless we live to our mid-90s, it means our kids will ultimately pay for their student loans.
 

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I’ve been in real estate development for 20 years. I used to run the second largest real estate portfolio in NY and taught corporate real estate asset management at an Ivy League school.

My two cents, and it’s worth exactly that:

-refinancing to lower payments is almost always a good idea assuming no prepayment penalty on either loan.

-cashout refinance is usually a bad idea for a primary residence unless your income can support the new mortgage with ease. You don’t wanna refi to a bigger loan, you or wife loses their job, and now the kids have to change schools.

-have a plan for your savings. I don’t care if that plan is to invest in alpaca futures. Do not spend your savings. Use it for retirement savings.

-the real estate markets on average appreciate 3% per year. Don’t expect huge jumps in valuation on the underlying asset.
 

DNice26

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Been looking at this myself! You guys are now getting me fired up to make it happen.

Only concern is, wife keeps talking about moving. If I'm not mistaken, refinancing is only a good idea if you plan to stay in the house for 5 years or more, correct?
 

tequila4kapp

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We’ve done it. Just remember, you restart the clock on your 30 years. Not a big deal for most because who expects to live in the same house for 30 years? Says the guy who’s now 17 years at his house. We considered moving to a 15 year loan but our advisor said no, just include the extra amount in your 30 year payment. We haven’t voluntarily done that once. Wish we would have moved to 15 years, the house would be paid off about now.
 

maxw72

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Not an expert, but do the math. $$$ reduced per month in your payment vs the cost of closing. That should tell you how many months it will take you to break even.
As someone who is in the FI industry starting as a teller and now in a position dealing with rates at a rather large credit union, this is a great way of thinking. With my background in Accounting it leads me to be a little more risk adverse but if you refinance into a 30 year and using a simple amortization calculator, you are able to find out what your 15 year payment would be and you are free to make that payment and your 30 year mortgage is being paid like a 15 year mortgage. This gives you the freedom to make the payments that you want, whether it is a 15 year payment or on those months where money is tight or holiday you can make the 30 year payment and still be ahead. It is rare in my dealings that you find a company that is going to penalize you on giving them their money more rapidly than originally planned.

To the OP @greekelite I would definitely do research on this but definitely refinance it. I would say do your research in that look outside of where your loan currently is. I'm fortunate in living in a state that is credit union rich and you will typically find your best rates for mortgages at a credit union, so if you have one locally I would definitely look into what their rates are. Credit Unions are a lot less closed off than they were in the past, almost anyone can become a member.
 

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