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atisler
72 Posts |
 Posted - 01/30/2008 : 11:22:57 PM
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| Hey guys I'm pretty new in this industry and I have a general question. About a 1 1/2 months ago, I refinanced someone R/T with WAMU and paid all his closing costs at a 6.125%. Now it looks like I can get him a 5.75% ish rate again no closing cost, which would save him another $60/mth. How long do I have to wait to make sure that WAMU won't take away my YSP?? |
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dtabar
1149 Posts |
Posted - 01/30/2008 : 11:54:56 PM
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| its usually 120 days. |
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unitedfed
60 Posts |
Posted - 01/31/2008 : 12:29:55 AM
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I'd be cautious. If rates keep falling what stops you from refinancing the client again?
Most states could perceive the actions as predator. |
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Scrooge McDuck
15108 Posts |
Posted - 01/31/2008 : 02:51:50 AM
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| close loans w lenders that dont have a recapture fee. |
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Pat
932 Posts |
Posted - 01/31/2008 : 05:06:21 AM
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There's currently no technology available to go back in time to close with a different lender... I don't believe that there are too many lenders that will pay a ysp every 2-3 months on the same loan.
The solution that's a win-win for lender/borrower would be to give them the par rate and take your money upfront. |
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dc62
279 Posts |
Posted - 01/31/2008 : 06:15:19 AM
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quote:
Originally posted by Scrooge McDuck
close loans w lenders that dont have a recapture fee.
Who are you using that doesn't recapture? |
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RDwyer
3308 Posts |
Posted - 01/31/2008 : 06:30:47 AM
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| Read your broker agreement with WaMu - it should lay it all out very clearly there. |
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1stintegritymort
1782 Posts |
Posted - 01/31/2008 : 06:35:21 AM
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| its usually 6 months or a year |
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shaslam
728 Posts |
Posted - 01/31/2008 : 07:18:56 AM
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| Why are you guys ignoring the fact that this rookie is going to refi someone AGAIN for $60 a month in savings? How is that ethical? This is all kinds of predatory. You can't refi someone to save .625 on the rate!! |
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RDwyer
3308 Posts |
Posted - 01/31/2008 : 07:33:25 AM
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| If he pays all their closing costs, I see nothing predatory about it. It's free to the consumer and saves them $720 a year. |
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Reegor
647 Posts |
Posted - 01/31/2008 : 07:42:49 AM
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WAMU has a 12 month YSP recovery.
Double-check the agreement.
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shaslam
728 Posts |
Posted - 01/31/2008 : 08:08:15 AM
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| Yeah right. No way it's going to cover all their closing costs. |
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jmatt
883 Posts |
Posted - 01/31/2008 : 08:24:24 AM
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quote:
Originally posted by shaslam
Why are you guys ignoring the fact that this rookie is going to refi someone AGAIN for $60 a month in savings? How is that ethical? This is all kinds of predatory. You can't refi someone to save .625 on the rate!!
That's what I was thinking.
Why do the $60 all at once? Why not refinance him three more times at $20 each?  |
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jeff4567
1607 Posts |
Posted - 01/31/2008 : 08:31:14 AM
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quote:
Originally posted by jmatt
quote:
Originally posted by shaslam
Why are you guys ignoring the fact that this rookie is going to refi someone AGAIN for $60 a month in savings? How is that ethical? This is all kinds of predatory. You can't refi someone to save .625 on the rate!!
That's what I was thinking.
Why do the $60 all at once? Why not refinance him three more times at $20 each?
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atisler
72 Posts |
Posted - 01/31/2008 : 09:15:57 AM
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| I'm sorry guys if it seems retarded for me to do that..yes I am a rookie, but I paid all his closing costs last time as I made 2.125 YSP and I kept about 1.375 in my pocket after closing costs. But I see nothing wrong with him wanting to refi again if it were to save him another $60/mth..that's free money..I talked to my AE at WAMU and he didn't give me a straight answer so that's why I asked. |
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windyctymktg
751 Posts |
Posted - 01/31/2008 : 09:19:57 AM
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| Depending on the loan amount 2.125% should cover the costs and leave some money to be made. While $60 per month is not the end all beat all if there are no closing costs and you can get a payoff minus the current escrow balance what is the harm in this. I typically look to save at least $100 per month with no costs so i wouldn't do this one. I think you will be stuck with the recapture period as others have stated. I too would like to know who has no recapture. |
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atisler
72 Posts |
Posted - 01/31/2008 : 09:31:02 AM
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| Thanks for all the help guys...except you shaslam :) |
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williamspeaking
4060 Posts |
Posted - 01/31/2008 : 10:02:35 AM
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quote:
Originally posted by shaslam
Why are you guys ignoring the fact that this rookie is going to refi someone AGAIN for $60 a month in savings? How is that ethical? This is all kinds of predatory. You can't refi someone to save .625 on the rate!!
To save 60 dollars a month is benefit in a R/T loan, however for him to have not just given him the pricing in the first place, and now try to get another unit funded this way, is kind of sleazy..
$60 a month is $21600 over the term of the loan. thats benefit. |
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Quicksilver
5940 Posts |
Posted - 01/31/2008 : 10:10:36 AM
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| How the heck did you pay "ALL" his closing cost with .75 ysp????? Your telling me you paid everything including title, taxes etc with .75?? |
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danyulmc
5 Posts |
Posted - 01/31/2008 : 10:24:28 AM
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My NYS Dept of Banking auditor would tell me that this one is predatory. unless i dont charge, do a CEMA, give him par, and lower his payments SIGNIFICANTLY, if it is within a few months.
And at the rate of a refi every 2 - 3 months $21600 over the life of the loan is not a real number to measure with. They are serious about the best deal for the consumer, and that aint it. |
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atisler
72 Posts |
Posted - 01/31/2008 : 10:41:53 AM
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| OMG please let's just delete this topic...I'm not trying to refi him every 3 months! He wanted to refi in Nov-Dec, and I gave him a great deal at 6.125% paying all his closing costs! I had no idea the rates would go down this month. Now he came back to ME and said why not do it again if he can save more money again, without paying closing costs. And yes I can pay closing costs with .75 YSP. .75 of 267,000 is $2,000... title is $500, WAMU lender commitment is $800, exterior only appraisal was $150, credit $20, courier, $30, and I even waived his escrows which was a little under $700..that's $2200! I'm not trying to rip anyone off! I'd probably be making less than 1 YSP total if I were to refi him again. And fyi taxes, even if escrowed, are NOT PART OF SOMEONE'S CLOSING COST! Gosh even a rookie knows that one... |
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clearwaterny
352 Posts |
Posted - 01/31/2008 : 12:27:37 PM
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| The u/w will probably not u/w this loan because there is not a real significant benefit in saving $60. In addition, I probably wouldn't even suggest to the client that they refinance to save that amount, you look more professional and you won't have regulators looking into why you did this loan. |
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Pat
932 Posts |
Posted - 01/31/2008 : 1:12:16 PM
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| Also, some banking regulators may not like it if you make over 5% in a 2 year period (even if you're paying the fees). |
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CoolMtgGuy
9062 Posts |
Posted - 01/31/2008 : 3:19:06 PM
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Simple ... follow the guidelines in your WAMU broker agreement. If you are an LO working under someone else's license, I suggest you discuss this with, and get the permission of, your broker. Once you know what you can and cannot do from a business and contractual perspective, then let that be you guide in counselling the borrower.
It is your job and responsibility to educate the borrower that there are many factors that affect ehether or not you can do this for them. Don't chase rates and forget the rest of your responsibilities. You are new to this business in a time when our industry is experiencing tremendous difficulties so please do not add to the probelm. It sounds like you mean well ... but the gates of hell are lined with people who "meant well".
I applaud you for asking the question. Now use the feedback to grow! |
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shaslam
728 Posts |
Posted - 01/31/2008 : 3:21:30 PM
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In what state are the title fees only $500 on a 267K loan amount? Tell me please, because I'm moving there tomorrow!! And what about title insurance??
Get the cripes outta here. |
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atisler
72 Posts |
Posted - 01/31/2008 : 3:48:42 PM
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| Thanks for the positive feedback. I'll definately check with my WAMU AE about that new program.. I still don't see why some of you think it's a problem for someone to save $60/mth if they are not paying closing costs and waiving escrows. How is that predatory?? I think the biggest waste of money for the average consumer is to pay closing costs to be honest. Why would someone pay upwards of $5000 closing costs and agree to pay a point up front just to save $50-$80 per month by getting a .5% rate lower, especially when they know damn well that they will probably be either moving or refinancing in the next three years anyways! That's why people don't have any equity in their houses!! People are so interest rate sensitive, they don't realize the money the are getting charged just so they can brag to their friends that they have a 5.375%...and everyone is saying that I'm not doing the right thing?? And sorry shaslam but in IL Ticor Title charges about $500. We just signed on with them, and the other title companies we work with charge about $700, what's the difference? I was just trying to prove that you could pay a borrower's closing costs with .75 YSP. Why must u try to instigate everything I say?? |
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jvanpetten
3928 Posts |
Posted - 01/31/2008 : 3:58:30 PM
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| That is what I like about Carteret, all I have to do is go to our web site and look up the lender and there it lists what the YSP recapture agreement is for Carteret. No guessing like most everyone here. AND, can I say, MOST lenders have a recapture policy. 120 days is normal, even if you are not the broker doing the refinance. |
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windyctymktg
751 Posts |
Posted - 01/31/2008 : 7:20:25 PM
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| I will tell you in Illinois the title company we use charges the same whether the loan amount is 100k or 267k. I know there is a number where the charges go up but it is not a whole lot. For Stewart Title the total title charge including closing, insurance, recording and unk fees is around $550. Take the title charges along with the $275 for the appraisal and lender underwriting fees and that 2.125% on a 267k loan leave a lot of room. |
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