Posted on: 22nd Nov, 2010 04:38 pm
My home is worth about $600000 and I have a balance on my mortgage of approximately $55,000. With an excellent credit rating what would be the lowest range of interest rate I could expect on refinacinf with a 30 year mortgage. Also, what would be the approximate out of pocket costs for title insurance, attorney fees, etc. Thank you.
hi gilrod!
welcome to forums!
the rates keep on varying on a daily basis. you should contact the lender and apply for a mortgage refinance and he will be able to let you know about the rates and closing costs. this community, too, has a large number of lenders. you can seek a no obligation free mortgage quote from them and check out the rates and terms you may qualify for.
feel free to ask if you've further queries.
sussane
welcome to forums!
the rates keep on varying on a daily basis. you should contact the lender and apply for a mortgage refinance and he will be able to let you know about the rates and closing costs. this community, too, has a large number of lenders. you can seek a no obligation free mortgage quote from them and check out the rates and terms you may qualify for.
feel free to ask if you've further queries.
sussane
gilrod1, as of today, you should be able to lock in a 30yr fixed rate at about 4.5. A couple weeks ago you could have gotten to 4.25% but people are worried about the ireland and spain bailouts right now so the rates are higher. But to be honest, you should not be financing $55k over 30 years. Some people finance cars in 5 years for that much money :) I would recommend a 10 year fixed. The rates on the 10 year are much lower (in the mid 3% range).
As for cost, most lenders have deals right now that they call "no cost" loans. What that means is that they offer you a slightly higher interest rate in order to cover the closing costs. You end up not paying for any of the typical closing costs like escrow, title, document fees, etc. These fees are typically $5-10k. Beware of lenders who are not offering actual "no cost" loans and are instead rolling the costs into the loan -- essentially increasing your principal.
Most lenders offer a 1/4 point of interest reduction if you pay your annual property tax and hazard ins each month to them. If that's the case, then you will end up paying for a couple months of property tax and hazard insurance up front. The lender likes to have a couple months of each (typically 5 months) as a buffer in the account. Since it will be paid to your insurance company and tax authority, it is not really a "cost" but it is a large chunk of money that you have to come up with at closing time.
Some people will roll this "cost" into the loan -- I don't recommend it.
Typically there will be one month at the beginning of your new loan where you only have to pay interest. So you can use the money you save in that month to help put money down for the tax/ins escrow account. Additionally, after your old loan is funded, if there is any money left in that bank's escrow account, they will refund it to you so you will get reimbursed the majority of it.
As for cost, most lenders have deals right now that they call "no cost" loans. What that means is that they offer you a slightly higher interest rate in order to cover the closing costs. You end up not paying for any of the typical closing costs like escrow, title, document fees, etc. These fees are typically $5-10k. Beware of lenders who are not offering actual "no cost" loans and are instead rolling the costs into the loan -- essentially increasing your principal.
Most lenders offer a 1/4 point of interest reduction if you pay your annual property tax and hazard ins each month to them. If that's the case, then you will end up paying for a couple months of property tax and hazard insurance up front. The lender likes to have a couple months of each (typically 5 months) as a buffer in the account. Since it will be paid to your insurance company and tax authority, it is not really a "cost" but it is a large chunk of money that you have to come up with at closing time.
Some people will roll this "cost" into the loan -- I don't recommend it.
Typically there will be one month at the beginning of your new loan where you only have to pay interest. So you can use the money you save in that month to help put money down for the tax/ins escrow account. Additionally, after your old loan is funded, if there is any money left in that bank's escrow account, they will refund it to you so you will get reimbursed the majority of it.