How low can we go? 30 yr fixed at 3.75% with no fees...

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Question about refi since we're first time homeowners. Current rate when purchased April 2015 was 30 year, 3.75% fixed.

We're now being offered 3.375% to refi, no closing/fees or points. Based on what we have left, it would save us $100ish a month. This is a no brainer right?

What's their incentive to offer this w/o any costs to us. Thanks in advance!
 
Gotta do the math, refi a 30yr back into a 30yr after only 1 year and your back to square 1, meaning the majority chunk of your payments is all interest to the bank and little to principal.  Breakdown the payment and see if it makes sense and not just base on how much you pay less per month total.
 
jumpinjacks said:
What's their incentive to offer this w/o any costs to us. Thanks in advance!
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The bank got the rate a lot lower than 3.375 (perhaps as low as 3.0) and sell it to you at 3.375.  Than they use part of the proceeds to cover the closing cost and other fees and pocket the rest as profit.

Edit:  I'm over simplify this, the mortgage things is a lot more complicated.  But all I'm saying is that bank still make a profit when they offer no cost refi or even cash back refi.
 
ps9 said:
Gotta do the math, refi a 30yr back into a 30yr after only 1 year and your back to square 1, meaning the majority chunk of your payments is all interest to the bank and little to principal.  Breakdown the payment and see if it makes sense and not just base on how much you pay less per month total.
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If the interest rate is lower and is being done at no-cost then it obviously makes sense, you just have to make sure you pay slightly more than your new payment
 
jumpinjacks said:
Question about refi since we're first time homeowners. Current rate when purchased April 2015 was 30 year, 3.75% fixed.

We're now being offered 3.375% to refi, no closing/fees or points. Based on what we have left, it would save us $100ish a month. This is a no brainer right?

What's their incentive to offer this w/o any costs to us. Thanks in advance!
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Because they'll make money on the fees and on the rate spread differential. 

It's a no-brainer man...not only do you save on your monthly payment but a higher % of your payment goes towards principal.
 
Thanks all, makes sense. We were paying a little more towards principal each month lately so can pay the same and put just that little extra back into the principal. I saw some articles mention it's only worth refi for 2% lower or even 1% lower but ours is 0.375% lower. But probably considering also length of time on current mortgage and fees/points.

Crazy rates, I thought 3.75% a year ago was a steal.....hence name of thread!
 
jumpinjacks said:
Question about refi since we're first time homeowners. Current rate when purchased April 2015 was 30 year, 3.75% fixed.

We're now being offered 3.375% to refi, no closing/fees or points. Based on what we have left, it would save us $100ish a month. This is a no brainer right?

What's their incentive to offer this w/o any costs to us. Thanks in advance!
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wow that's a very good rate for refi now.  Are you SFH or condo?
 
Roger said:
jumpinjacks said:
Question about refi since we're first time homeowners. Current rate when purchased April 2015 was 30 year, 3.75% fixed.

We're now being offered 3.375% to refi, no closing/fees or points. Based on what we have left, it would save us $100ish a month. This is a no brainer right?

What's their incentive to offer this w/o any costs to us. Thanks in advance!
Click to expand...
wow that's a very good rate for refi now.  Are you SFH or condo?
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SFH, our loan person is a family friend of mother in law. She was looking at yesterday's rate and reached out to us. It's now gone up and waiting to lock in. She said if it doesn't go down, we may have to pay $500 or so in fees which still works out better. It's not a jumbo loan since we put enough down at purchase to come right in under jumbo.
 
Irvine Dream said:
jumpinjacks said:
[ It's not a jumbo loan since we put enough down at purchase to come right in under jumbo.
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Per previous threads you can get a better rate if it is a Jumbo Loan
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Mo money, mo problems? Hahah. Now my husband is curious to kick in more money to lower the refi loan amount and she's mentioning we could get something even better since it will be around 60% LTV......

Is this typically a big discount in interest rate? We bought at 70% LTV to get that 3.75%
 
jumpinjacks said:
Irvine Dream said:
jumpinjacks said:
[ It's not a jumbo loan since we put enough down at purchase to come right in under jumbo.
Click to expand...

Per previous threads you can get a better rate if it is a Jumbo Loan
Click to expand...

Mo money, mo problems? Hahah. Now my husband is curious to kick in more money to lower the refi loan amount and she's mentioning we could get something even better since it will be around 60% LTV......

Is this typically a big discount in interest rate? We bought at 70% LTV to get that 3.75%
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Mmn!! I was trying to point out that you would get a better rate if it is a Jumbo Loan (i.e: you wouldn't put additional money but rater not put as much to keep the loan as Jumbo, you can always pay the Principal down right after closing)
 
I know it isn't the April/May anymore, but I locked in at 3.125%, 0 points on a 30 year fixed Jumbo (20% down).  Non-jumbo quotes were half a point higher.  Rates were initially quoted around 4% or so but playing BoA and Wells Fargo against each other worked wonders.  Doesn't seem like much has changed so I bet you could get in that range with some effort, maybe even better.
 
I have refinanced with cashcall in the past - they are pretty good and they have no closing cost loans. Folks are available to answer questions sometimes late into the evening.
I am currently refinancing with cashcall for 30 year conforming loan at 3.375 rate , no closing cost for my condo. Hoping it goes well and closes in time.

I shopped around in the last 2 weeks - I couldn't find anything lower than 3.25 rate, but most had some type of out of pocket costs for the 3.25 rate. I wanted one that was 0 cost, so I picked cashcall.
 
Irvinehomeseeker said:
I have refinanced with cashcall in the past - they are pretty good and they have no closing cost loans. Folks are available to answer questions sometimes late into the evening.
I am currently refinancing with cashcall for 30 year conforming loan at 3.375 rate , no closing cost for my condo. Hoping it goes well and closes in time.

I shopped around in the last 2 weeks - I couldn't find anything lower than 3.25 rate, but most had some type of out of pocket costs for the 3.25 rate. I wanted one that was 0 cost, so I picked cashcall.
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Let us know your experience in a week or 2.  I'm thinking of trying CashCall as well.  They seem like a lender for low income families or something (with advertising on midday TV), but I actually heard good things about them.
 
aquabliss said:
Let us know your experience in a week or 2.  I'm thinking of trying CashCall as well.  They seem like a lender for low income families or something (with advertising on midday TV), but I actually heard good things about them.
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Aquabliss

I assume that your loan is a jumbo loan (or are you richer than I thought).  Cash Calls Jumbo mortgage rates are higher right?.  Did you try PS9's lady or Soylent Green?
 
I'm probably cash poor and house rich, that's part of the reason I'm doing the refi.  I think I may go with CashCall and get the lower (just under jumbo $) rate.
 
aquabliss said:
I'm probably cash poor and house rich, that's part of the reason I'm doing the refi.  I think I may go with CashCall and get the lower (just under jumbo $) rate.
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Let us know how that works out. I always hear their ads on ESPN710 so I'm interested to see how they are.

#RonnieReferral
 
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