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Change the lender

I am in the process of refinancing my FHA loan $317k (prior to May 2009) with my current lender Wells Fargo. It's been over 70 days I started the process and no response from them. The processor is saying that they have too many applications from our area so they are taking long time these days and not sure how many more days it will take.  I got an offer from different lender for 3.5% rate Fixed 30 yrs with No Cost Closing. Wells Fargo offered me 3.75% rate with 1.625% credit towards closing. My rate lock expires on Oct 30.

Is it worth or possible to change the lender at this time? Please advise.
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September 05 2012 - US
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Answers (6)

You should be able to get the same adjusted origination amount at rate about .5% lower. To be fair Wells locked your rate in a higher market. I would tell them you have seen much better terms available and you want them to do better for you to close. Wells is known for allowing rate renegotiation in improved market and also for improving their terms offered when you have one foot out the door. I would try to work something out with them that is more in line with current market.
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September 24 2012
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Thanks Justin for the information. My original loan was generated with Wells Fargo before May 2009. The adjusted origination charges on GFE are -$4174.94. With 3.75% rate I am not paying any closing costs including escrow and saving about $325 per month and this loan is ready close with Wells Fargo. Now I read every where rates are under 3.5% so  am I closing my loan at higher rate?
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September 24 2012
Not enough information to advise.   When Wells Fargo sells/securitzes the 317,000 loan at 3.75% there is about 25,000 of profit to be had.   If your adjusted origination fee is a negative number, you can subtract that from 25,000 and that is the amount of profit being made on your loan.

If you think that amount is too high, you might want to look elsewhere.   Market rates are currently about .5% lower than that and will provide enough closing cost credit to cover all your fees and even to set up most/all of the amount needed for your new impound account, especially so on a grandfathered streamline when you have only .01% UFMIP fee instead of the 1.75% for non-grandfathered loan.

What is the Box A Adjusted Origination Fee you are being charged/credited on your Good Faith Estimate for this 3.75% Rate?
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September 24 2012
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My application approved and ready to close tomorrow. I am not paying anything at closing rather I would get $500 back. My loan amount remains same just adding last month's interest on it. Shall I continue this application at 3.75% rate 30 yrs Fixed or cancel and find a lower rate? Please advise. Thanks.
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September 24 2012
Always check the numbers on the GFE.
"No closing costs" doesn't always mean a lower bottom line.
Check the paperwork!
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September 05 2012

I good broker can complete this FHA streamline refinance in a couple of weeks from start to finish.  Just make sure you are comparing apples to apples when it comes to closing cost and what the lender is paying based on the rate you are offered.

 

I only lend in Florida!

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September 05 2012
 
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