Mortgage / refinancing question

[mikebw]

I know we are all mortgage lenders here so I thought I could get some help

Basically I am trying to figure out if I should try to refinance my home loans.
I know the fed has cut key rates to the 2% range, I also know that this does not necessarily mean equally low home loans. What I don't know is who I should talk to about figuring out if I can get a better deal than I signed up for last year.

Should I talk to my original mortgage broker guy? He was very nice and helpful, I would trust him again. I could also call Bank of America who has my 1st loan, or Countrywide who is servicing my 2nd loan. (The two add up to what I paid for the house).

Consolidation seems like a good idea, and since I have a 5/1 ARM (interest only) it would be good to lock into a low rate now if I can. Although, I did qualify for a low interest rate last year (great credit score) so I don't know how much lower it could get.

I guess I am most concerned about who to talk to, any experiences on who go to for help with this stuff?

[Chupa Chupa]

Try this refi calculator. Plug in the rate/term etc of your existing mort and the refi and it will tell you if you will save any $. You'll have to skip through the ad.

http://www.bankrate.com/brm/calc_vml/refi/refi.asp

[Michael]

When we refinanced a couple of years ago, I went to Bankrate.com and found who had the best deal of an institution with which I was comfortable (not going with "Bob's Auto Repair and Home Refinancing"). Turns out it was Wells Fargo. I did it all online. I had one phone call to set up the closing and a closing attorney traveled 60 miles to my work to the closing.

Our equity line is with Wachovia. That took a phone call to get it started and then a visit to the local bank to sign some papers.

Of course, things are different today since the mortgage problems, so it might be more difficult if your credit isn't golden and/or you won't have significant equity in the house.

[mikebw]

Hmm, not sure if that will help since my two loans are at different rates. The big loan is 5.875% I think, and the smaller is closer to 8%.

[mikebw]

[quote Michael]so it might be more difficult if your credit isn't golden and/or you won't have significant equity in the house.
Yes, credit is still great, but there is the problem with equity. We have done some upgrades to the house, but since property values have dropped a few percent in the area since last year we would be lucky to have earned any real equity since then.

[Jem]

Why not get one larger loan at the better rate (refinance "plus") and pay off the other loan with the "extra" cash on your new mortgage.

Unless there is a pre-pay penalty, I don't see why this wouldn't work?

[SDGuy]

Also check your local credit unions. YMMV on this, but when I refinanced ~ 3 months ago, one of the credit unions around here had rates ~3/4 point less than everybody else. I jumped on that one (5.125 for a 30-yr fixed). They should have websites where you can check the rates online.

[mikebw]

The reason we didn't get just one loan at the lower rate was because lenders would not finance more than 80% of the value of the property on one loan. Since we did not have 20% to put down in cash we had to get a second loan on the remainder.

I imagine lenders are even less willing to finance more than that now so I don't see how we could qualify for a bigger loan today.

[Chupa Chupa]

[quote mikebw]Hmm, not sure if that will help since my two loans are at different rates. The big loan is 5.875% I think, and the smaller is closer to 8%.
That shouldn't matter unless you are trying to consolidate into one loan. Otherwise you are going to refinance each loan separately as they are now. Plug the #s in for each loan. I'm guessing you'll want to refi the 2nd loan (assuming it's of a high enough value to refi) and keep the 5.875% loan (unless it's an ARM).

[lost in space]

Here's a loan calculator I did in Excel a few years back. Enter loan info, like rate, amount, etc. You can add in a lump sum or additional principal-only payment.

Taxes and insurance extra.

No warranties.