My wife and I bought our place almost a year ago, and our loan officer glorified ARMs and so on. We decided to go with it, but now our rates are climbing. We're still able to afford payments, but we could be paying LESS on a 30 year fixed mortgage, instead of this garbage negative amortization loan. What are the steps to do this? I don't want to just walk into Bank of America and say "I want to refinance with you guys" or hit up Lending Tree or whatever. I guess I'm wondering what good steps I can take to selecting a lender and getting into a loan that's better for us. Are there any recommended banks, companies, individual lenders, etc? Thanks!
2007-09-20 13:21:37 · 5 answers · asked by Anonymous in Business & Finance ➔ Credit
5 year arm - 10 year - 15 year? It all depends what you have.
Subprime market is horrible right now, and is only going to get worse in the forseeable future, get out, AS FAST AS YOU CAN!
The problem with certain banks is that they will have no upfront fees which will save you 1700 bucks at Bank of America (BofA) against comparative banks that charge the 1700 up front.
Here is where it is tricky... BofA then has your rate locked at 6.7% for the life of the loan, making you think you got a good deal as the fees were waived.
However the bank that does charge upfront fees usually has their rate somewhere around 6.25%, saving you a lot more than 1700 for the long haul of the loan.
Point is, read the fine print and make sure you can afford a variable ARM before you go into it or a subprime market.
Go with a fixed rate, usually only nominally higher than an ARM, and you know what you pay each month.
2007-09-20 14:12:54 · answer #1 · answered by Anonymous · 0⤊ 0⤋
I'm no fan of BofA but they do have a passable reputation. Or get with your local community bank or credit union. Shop around for the best terms and stick with the major local players.
Obviously you want a fixed rate, fully amortized mortgage. If you consider an ARM, make SURE that it has at least a 5 year lock. 7 or 10 would be better. And FORGET "Option ARMs" -- that's the turkey you're stuck with now -- and their negative amortization.
2007-09-20 13:29:08 · answer #2 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Now may be a good time, but if you wait it out another two months or so, rates could go even lower. The federal reserve board just cut rates half a percent and may have to follow this up with a couple of quarter point cuts in the future.
Bankrate.com has a pretty good site with a lot of information on it regarding different loan types and rates. This site can tell you who has the lowest rates and least closing costs.
2007-09-20 13:38:34 · answer #3 · answered by Bobcat 3 · 0⤊ 0⤋
So what's wrong with shopping around? You would for a car, and this involves a LOT more money
Ask several institutions and see who gives you the best offer -- would probably help if you had a copy of your credit score with you.
LOTS of places will charge you, or try to get you to subscribe -- DON"T go look at
http://www.ftc.gov/bcp/conline/pubs/credit/freereports.shtm
2007-09-20 13:31:45 · answer #4 · answered by jimdotedu 5 · 0⤊ 0⤋
We went through a mortgage broker who found the best loan for our needs.
2007-09-20 13:29:04 · answer #5 · answered by Lauren B 3 · 0⤊ 0⤋