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Should I ask my mortgage company to refinance or go elsewhere?

Purchased my house new little over 14 years ago. Payments auto draft so always on time and my credit is perfect. I asked my mortgager to remove the PMI (only $20 month) since I was paid down to 72% of loan/worth. They said not until next year unless I paid $500 for new appraisal. THEN I realized that I was paying 7.25% interest. I have decided that I am refinancing but was told that I may want to ask my current mortgager to reduce my rate instead so I don't have to pay all the fees and closing cost of refinancing. Whatcha Think???
  • October 24 2013 - US
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Answers (11)

Best Answer

If your current mortgage lender hasn't contacted you to refinance at this point, given your current rate, please don't make any assumption that they will be your best choice if you contact them for a refinance. They should have been all over this many years ago. Refinance the 7.25% right away during this current slight dip in rates.
  • October 24 2013
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You are getting good advice on this question. 

To add a few points:
1.  Your current servicer is not going to just lower your rate without refinancing.  They are going to have you pay fees just as any other new lender will do.  May as well shop around and see who offers what.
2.  Be sure you are comparing apples with apples so to speak.  Since you have been paying for 14 years, you probably don't want to go back to another 30 year loan.  Be sure your offers are for the same term.  Don't let a lender sell you payment as you may end up paying gazillions more in interest by extending the term back to 30 years.  Your rate is high enough that you should be able to trim the term to 15 years and still lower your payments.
3.  As for credit, as long as you do your rate shopping during a 14 day period, all of the credit pulls should be counted as 1 and will not adversely impact your score.  The credit agencies that put together the score system wanted to make sure you could shop around.
4. After you narrow your list down to 2 lenders, find out what the lock in policies are. Rates are lowering now. A good lender will allow you to "Float Down" if you lock and the rates continue to improve. Ask.

Good luck and don't delay.  Every month is costing you money!!
  • October 25 2013
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CTF
You should let fellow Tide fan, Clay Branch, look at your refi options. He is an expert on financing and SEC football. He's probably wearing a Houndstooth Fedora right now.

Go Gamecocks! 
  • October 25 2013
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ROLL TIDE! 26 hours til kickoff.

CrimsonTideFan, is your loan balance low like 25K, 30K, etc?
  • October 25 2013
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Speak to a few mortgage professionals about your options for refinancing.  Compare the different rates and settlement charges get a full understanding of the financial figures involved with your refinance.  The "good faith estimate" for a mortgage transaction breaks out the various settlement costs you will incur.  Service is also important so do your research.  Best of luck!

  • October 25 2013
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Profile picture for daveskow
you can get  lots of  quotes  from lots of lenders without anyone pulling your credit  report ....just provide  each lender  the same variables and call on the same day to request these quotes
  • October 24 2013
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Profile picture for CrimsonTideFan
Doesn't a few creditors doing checks lower your credit score?
  • October 24 2013
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Its always good to get a few quotes and compare them.  Also, always ask if the lender can lock you in right away so you know you can obtain the rate they have quoted.

If you need a quote from a reputable lender, contact me through my profile.

We are a Federally Chartered bank that has been open since 1905 and lends in all 50 states.

Thank you and good luck!
  • October 24 2013
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Profile picture for CrimsonTideFan
I was only told that I should ask my lender to lower the interest. I know absolutely nothing about bank/finance and it shows by the fact that I have been paying this rate for so long. I don't know whether this sort of rate drop is possible, but I do know that if I refi somewhere else, my lender stands to loose thousands of dollars over the next 15 yrs. from a customer that pays their mortgage the same day every month. If this company was up on their game, they would've dropped this $20 mth fee for the next 8 months and continued to rape me for another 15 yrs.
  • October 24 2013
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Profile picture for daveskow
Do both

Ask present lender / servicer what they can do AND ask a few other firms for the same thing

compare and contrast

make decsion

easy process
  • October 24 2013
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Profile picture for Bkgdc
Who told you the lender would reduce the interest rate without refinancing?  
You should call your current lender.  Get them to put the details in writing (required by federal law.)  

Check with other lenders to compare.

  • October 24 2013
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