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Anyone use Quicken Loans to Refinance your Mortgage? I purchased my house back in May 2009 & locked in my rate at 5%. I went FHA and now I really want a lower rate. Quicken Loans always sends me things in the mail so I gave them a call to see what they offer. They said that they have a program where they pay the PMI Insurance for the loan but it's a Conventional Loan. They took all my info and will call me back tomorrow to see exactly what kind of figures they come up with. I'm not after a lower payment, just want a lower interest rate and maybe a shorter term.
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What do you owe on the mortgage and what will the house appraise for? Hopefully you'll have 20% equity in the home and avoid having to pay for PMI. If you're close to that value either pay the difference or get a second mortgage. I'll never do another home without at least 20% down. My PMI is almost $200 per month... -
I owe 145K and it's appraised at around 160K - 170K. My PMI is about $65 a month. They said if I have 5% Equity and with my high credit score that I would qualify for the Conventional Loan and they pay all my PMI Insurance. Just don't see how that makes sense.Comment
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They're giving you a higher rate to buy out the mortgage insurance. Sometimes it makes sense, sometimes it doesn't (depends on your credit score and current rate/MI factor). Mortgage insurance insures the lender against loss (since you're putting less than 20% equity into the house). I've never heard of a lender that will pay it for you or not require it without charging you more for it by way of rate or fees.
Quicken is "engineered to amaze", and they amaze people by "getting them out of paying for PMI". The catch is the higher rate or fees to do it. Most people just look at the bottom line and since rates are so low now, even if they give someone a higher than the market rate, people see their rate going down from where it is currently, the removal of the devil (PMI), and they jump without actually running the numbers.Comment
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They told me that the rate would be lower than what I am currently at which is 5%. Said to qualify for the new program I had to have a 780 or above credit score and at least 5% in equity.Comment
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Yes, lower than what you currently pay, but higher than what you could get if you took monthly mortgage insurance (or paid the single premium up front instead of letting them cover it with a higher rate).Originally posted by Mike69 View PostComment
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So might make more sense to just stay where I am at huh?Comment
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It doesn't look like you have the 18 - 22% equity most require to not have PMI but if you are considering refinancing you might check into several places and options. Randolph Brooks had an awesome refinance special I went with for 11 yr.
Here are their posted rates today:
Today's Rates
Click below for details.
APR1 as low as2:
Mortgage (30-Yr Fixed) 3.608%
Mortgage (20-Yr Fixed) 3.526%
Mortgage (15-Yr Fixed) 2.940%
Different lenders use different PMI stuff and the costs vary greatly.Comment
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Stick with Marty here on the board. The dude is great and will take care of you. He's gone above and beyond helping me on both my loans.Comment
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Quicken Loans got back with me. They can refinance my mortgage from a 30 year down to a 15 year for about $300 more per month.
Current Mortgage (30 Yr Fixed) 5.00% - Payment with taxes & insurance = $1330
Refi Mortgage (15 Yr Fixed) 3.50% - Payment with taxes & insurance = $1600
They will pay the mortgage insurance as well. About $5000 for closing cost that they will roll into the loan if I choose to. I would have to pay $500 out of pocket as a good faith estimate ad will go towards the loan.
I do plan on turning this property into a rental in about 5 years or so. Not sure what I'm going to do yet though.Comment
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I was just saying that "no PMI" doesn't mean it's a better deal.Originally posted by Mike69 View Post
I haven't seen Marty post in years, you might want to post his user name if you're going to refer someone.Originally posted by houstondallas View Post
$5,000 in closing costs on that size loan means you're paying for the PMI or they're charging you a point for those rates. Either way, that's what I was trying to say from the beginning. Keep shopping.Originally posted by Mike69 View PostComment
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I refied 3 years ago with lending tree saved a ton of money. House will be paid off in 12 years now.. thank god.sigpicComment
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Also PMI drops off after 5 years and when you have paid down 20% of your original loan.Originally posted by Mike69 View PostComment
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Thanks for the help! I'm just going to stick with what I have. I have a small rental townhome that I am trying to pay off within the next 2 years. Once that is done I'll just make extra principal payments every month to pay off my current home as soon as I can. It will become a rental at some point as well.Comment
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There is no set time for PMI to fall off, just a minimum amount of time required for it to be on the loan (in some cases). If you have PMI, you must pay the loan down to 78% of the value of the house for it to automatically come off. Paying down 20% of your original loan would technically put you below the 78% Loan-To-Value mark (unless you didn't put anything down) so that's technically true.Originally posted by 2011GT View Post
Depending how far you are into the 30 year term, you may get a better bang for your buck at the normal 15 year payment instead of paying additional principal on the existing 30, even after the cost of refinancing.Originally posted by Mike69 View PostComment
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