The Home Improvement Thread

hutch wrote:
sounds like you are refinancing!

Keep us posted!

not my first time at the rodeo
under three percent is a pretty big deal

guess this is my idea of a home improvement

Although I am going to be fostering about 20 baby chickens for the next 4 weeks
so that seems like much more fun to talk about than refi's

Awesome to hear you know what you’re doing and are experienced…

Let us know when you’ve done it

Hatchy wrote:

hutch wrote:
sounds like you are refinancing!

Keep us posted!

not my first time at the rodeo
under three percent is a pretty big deal

guess this is my idea of a home improvement

Although I am going to be fostering about 20 baby chickens for the next 4 weeks
so that seems like much more fun to talk about than refi's

Riddle me this… You're attempting to lower your payment or you're attempting to take cash out?

Also, how long until you break even from the closing costs….

Also, I think this has been explained, but hey space, you don't have a sub 3% 15 year rate my friend.

Yada wrote:

Hatchy wrote:

hutch wrote:
sounds like you are refinancing!

Keep us posted!

not my first time at the rodeo
under three percent is a pretty big deal

guess this is my idea of a home improvement

Although I am going to be fostering about 20 baby chickens for the next 4 weeks
so that seems like much more fun to talk about than refi's

Riddle me this… You're attempting to lower your payment or you're attempting to take cash out?

Also, how long until you break even from the closing costs….

Also, I think this has been explained, but hey space, you don't have a sub 3% 15 year rate my friend.

According to freddiemac.com 15yr rate was down around 2.75 in 2016. I think we refinanced in 2014 looks like it was low 3's.

Space wrote:

Yada wrote:

Riddle me this… You're attempting to lower your payment or you're attempting to take cash out?
Also, how long until you break even from the closing costs….

Not decided yet, but most likely just to lower payment

I'm not CPA….but this is my logic
if the closing costs are wrapped in the loan and the loan payment goes down.  I'd say there is no break even time frame
Yes the loan is higher and the term longer…so this is not free
But, my monthly payment goes down today and I'm saving $40k in interest over the life of the loan
(but yes the principal is higher = the closing costs)


Additionally, my broker had a rate protection program and their closing costs are free for this re-fi
an appraisal is getting waived
Title related stuff:  I've found some good ways to save on that part too
I don't go with the one they offer (last time was $350 savings)
see if you can 'renew' the title insurance from the last transaction (last loan I couldn't, but did this in CA and saved a few hundred too…not sure if VA has different laws about that)

Let me know where the holes in my logic are? (like you wouldn't  ;) )

According to freddiemac.com 15yr rate was down around 2.75 in 2016. I think we refinanced in 2014 looks like it was low 3's.

just because that was advertised, that by no means meant you got that
look on your loan doc, likely online

I've never heard of anyone being able to wrap closing costs into the loan… Where are you reading/seeing this info? This could be something a dump bank on the internet offers, but I'm not aware of it.

Additionally, if it's less than a 1% savings in your interest rate, it's probably not worth it IMHO.

I'm going to assume based on where we all live (unless grandpa or dad or someone else helped with this down payment as well) that you owe at least 500k on your mortgage. If it's less than 1%, it will take you at least a few years to see the savings of your closing costs…

Yada wrote:
I've never heard of anyone being able to wrap closing costs into the loan… Where are you reading/seeing this info? This could be something a dump bank on the internet offers, but I'm not aware of it.

Additionally, if it's less than a 1% savings in your interest rate, it's probably not worth it IMHO.

I'm going to assume based on where we all live (unless grandpa or dad or someone else helped with this down payment as well) that you owe at least 500k on your mortgage. If it's less than 1%, it will take you at least a few years to see the savings of your closing costs…

are you kidding me
so lets say its a 300k loan (not talking about downpayment)
and closing costs are 10K
They just make it a 310k loan

I've probably done it this way at least 7 times

again the loan is bigger, so it's not free money
but if your payment is $1500 and you pay closing costs of $10k up front
Or you wrap that into your 30year fixed and your payment is $1545 (and your principal is now $310)
Am I missing something

Hatchy wrote:

Yada wrote:
I've never heard of anyone being able to wrap closing costs into the loan… Where are you reading/seeing this info? This could be something a dump bank on the internet offers, but I'm not aware of it.

Additionally, if it's less than a 1% savings in your interest rate, it's probably not worth it IMHO.

I'm going to assume based on where we all live (unless grandpa or dad or someone else helped with this down payment as well) that you owe at least 500k on your mortgage. If it's less than 1%, it will take you at least a few years to see the savings of your closing costs…

are you kidding me
so lets say its a 300k loan (not talking about downpayment)
and closing costs are 10K
They just make it a 310k loan

I've probably done it this way at least 7 times

again the loan is bigger, so it's not free money
but if your payment is $1500 and you pay closing costs of $10k up front
Or you wrap that into your 30year fixed and your payment is $1545 (and your principal is now $310)
Am I missing something

If you're paying 10k to refi a 300k loan, you're getting bent over in every direction imaginable… Think Space sex after a sweaty hike in the Shenadoahs. Anyway, in the long run they were you're doing this and looking at it, you're going to be losing $$ amigo.

That is what I was trying to tell him but this isn’t his first rodeo!



We have spoken to advisors who tell us exactly that: to be worthwhile to refinance rates have to go way down

Yada wrote:
Think Space sex after a sweaty hike in the Shenadoahs.

thanks to you, asshat, i now can't not think of that.  ugh.

I would give anything to have sweaty sex on a hike in the Shenandoah's right now.

I checked my statement, we are paying 3.375 on a 15 year that we refinanced in March 2015. This is above the 3.04 historical that Freddie Mac lists. So Yada, you are right. I'll get you a pre-show beer asap.

I should qualify by “we” I mean my worse half because as Sidehatch knows I don’t have anything to do with money other than spending it as fast as I can when I can get some

Yada wrote:
If you're paying 10k to refi a 300k loan, you're getting bent over in every direction imaginable…

I don't have that number yet..but only doing this based on how that number works out
Originally was thinking it would be close to $200 less, but looking like closer to $150…so little less desirable

so I've said it many times in this thread…the loan is bigger and the term is longer
I'm aware of that.  So yes…that is 'losing $$'

but lowering fixed costs TODAY is way more desirable to me
That's my main goal is getting my fixed monthly costs as low as I can
a lot of people might not want to put the effort in to save $150 a month, I'm fine with that..especially since it's a cost I'm on the hook for 360 months

This is my understanding of breaking down closing costs
closing cost total last time was $8k…but half of that was costs that I was already going to have to pay
So real sunk costs to me were in the $4k range


Origination - this was close to $2k last time
    this is the number I'm looking at this time around as they said they would cover 'their closing costs'

Title/title insurance/other fees - This is where you can get fleeced a little.  the original quote was $1550, shopped around, and got it under $1200.  I'm hoping this time I can 're-new' the title insurance… could get that number closer to $900

Gov't cost…this is a loss and was just shy of $1k

4k for 'closing costs' last time
I'm hoping that is around $2500 this time
I guess that is where your break-even math comes in.  If I have to spend $2500 to save $150 a month, then 16 months is my break-even

Then there are things like pre-paying insurance and the property tax for escrow
for me that was about $4k….but that was money I was going to pay out regardless
The only difference is I financed that 4k in the loan and won't have to come up with that 4K in 2020 (more money not being spent today…but over the life of the loan)

So if I pay $X for Principal and interest today
and after 10 hours of paperwork, I'm paying x -$150

Seems like I'm not having to shell out $150 a month today and for the next 360 months…seems like a good deal to me
even if over the course of the loan I'm paying more

Now I could come up with all of the closing costs at signing (lets say 6.5k)
I could pay $178 less a month

but paying the $28 a month for to cover that 6.5k seems ok in my book as long as my monthly outlay is $150 less

Hatchy's getting kind of Spacey. Nice.

Did somebody pay you for the time you spent typing that?

Space wrote:
Hatchy's getting kind of Spacey. Nice.

Have it on good authority and can confirm.

hutch wrote:
Did somebody pay you for the time you spent typing that?

almost every character written by me on this forum is paid by someone ;)

Yada wrote:

Space wrote:
Hatchy's getting kind of Spacey. Nice.

Have it on good authority and can confirm.

dude…in these COVID times, getting fixed costs low is a priority!

For example, the following illustrates the savings of a .5% and 1% drop in rate for a $400,000 loan.

                                                          Monthly  Annual   Lifetime
Savings decreasing rate .5% $114       $1,368 $41,040
Savings decreasing rate 1% $224       $2,688 $80,640

This thread is so rock!!