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celloshred
2864 Posts |
 Posted - 11/04/2009 : 7:35:31 PM
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"Hi, I have 24 years left on a 5.5% mortgage. I want to refinance to save money but I dont want to pay points or any finance fees"
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KHufford
10407 Posts |
Posted - 11/04/2009 : 7:41:07 PM
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quote:
Originally posted by celloshred
"Hi, I have 24 years left on a 5.5% mortgage. I want to refinance to save money but I dont want to pay points or any finance fees"
Response:
"Thanks for the info, sorry but I could not be of assistance based on those parameters"
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syndicator
442 Posts |
Posted - 11/04/2009 : 7:50:14 PM
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Well find out if he is trying to save money on a monthly basis or during the life of the loan. The mortgage is most likely 6 years old meaning he may have purchased or refi'ed before the boom.
If he is trying to save over the life of the loan put him in a 20 year I think it can be done with no points and or fees.
If he's trying to save on a monthly basis. What is his loan amount and is he on a fixed or arm? It may be a bit trickier and may or may not be worth it for you. but it will come with a tight margin
Just think referrals, |
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celloshred
2864 Posts |
Posted - 11/04/2009 : 8:34:03 PM
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well, the only way to make it work for them (assuming the rest of the parameters meet u/w) is to buy-down. it will probably increase the costs over the life of the loan but can save $200+/month which is about 10-15% less than current payments.
some people cant wrap their heads around paying $6k-9k to save $200/month even though thats what they want :-) |
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jvanpetten
3928 Posts |
Posted - 11/05/2009 : 05:51:30 AM
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| All my clients start out the conversation that way on a refinance. |
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mcmoney
743 Posts |
Posted - 11/05/2009 : 06:08:55 AM
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quote:
Originally posted by celloshred
"Hi, I have 24 years left on a 5.5% mortgage. I want to refinance to save money but I dont want to pay points or any finance fees"
"I understand, sir/ma'aam. The way I see it, you can really go on one of two routes here. The first is zero cost, or close to zero cost refinance that will not decrease your rate. Obviously, this provides no benefits so I think it's safe to assume we don't need to talk about that any further, agreed? The second route is to pay $X,XXX to originate this loan at X.XX% which will save you $XXX monthly (Or $XX,XXX over the life of the loan depending on his/her goals, which you would ascertain first). So, sir ma'am, the question at hand is do you feel it is worth investing $X,XXX in settlement fees to achieve a $XX,XXX benefit over the life of the loan (or $X,XXX annual payment savings, again dependent on the goal)."
1) If you calculate no benefit in the refinance, inform them of such and ask if you could potentially help anyone else they know.
2) If there is a clear benefit and they don't see it, it is what it is and wish them the best of luck.
3) If they do see the value, go into the subject of discount points or removal of ysp and addition of broker fee to illustrate how different levels of fee yield different levels of savings dependent on the metric of measurement chosen.
Good hunting.
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Scrooge McDuck
15108 Posts |
Posted - 11/05/2009 : 07:00:37 AM
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you dont know what they mean by "i dont wanna pay."
they might mean "out of pocket." |
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mcmoney
743 Posts |
Posted - 11/05/2009 : 07:03:50 AM
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quote:
Originally posted by Scrooge McDuck
you dont know what they mean by "i dont wanna pay."
they might mean "out of pocket."
Very true. Then again, the client often doesn't know what they mean by it either. |
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carriemaese
3887 Posts |
Posted - 11/05/2009 : 08:38:28 AM
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quote:
Originally posted by jvanpetten
All my clients start out the conversation that way on a refinance.
Almost all my clients do too even on purchases, because they have a "friend" that told them they could get it. Whatever, then have your "friend" refer you to someone. |
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jvanpetten
3928 Posts |
Posted - 11/05/2009 : 08:55:50 AM
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Now, with the internet, everyone is an expert. "I saw this rate on the internet and I don't want any closing costs." Good luck finding that.
I had a client who wanted everything recently, including to lock before he found a home. After 2 face to face meetings and listening to them beat me up on my fees, I had to let them go. They were just too edumacated on the process and wanted not only a par rate, but no fees up front, no origination/processing. This kind of experience always reminds me to not waste time and see the signs of a borrower who is going to beat me up for very little in commission early in the process. I usually see it as a challenge and feel good if I make a relationship with a Realtor or with the client for referrals, but sometimes you just need to move on. |
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carriemaese
3887 Posts |
Posted - 11/05/2009 : 08:59:49 AM
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quote:
Originally posted by jvanpetten
Now, with the internet, everyone is an expert. "I saw this rate on the internet and I don't want any closing costs." Good luck finding that.
I had a client who wanted everything recently, including to lock before he found a home. After 2 face to face meetings and listening to them beat me up on my fees, I had to let them go. They were just too edumacated on the process and wanted not only a par rate, but no fees up front, no origination/processing. This kind of experience always reminds me to not waste time and see the signs of a borrower who is going to beat me up for very little in commission early in the process. I usually see it as a challenge and feel good if I make a relationship with a Realtor or with the client for referrals, but sometimes you just need to move on.
very true. I just tell them I don't work for free the same way they wouldn't, and of course to have a good life and good luck searching for that someone who does work for free. |
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Csolorzano
205 Posts |
Posted - 11/05/2009 : 09:01:16 AM
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| Seems like you need to be real with the client. Provide your GFE as you would (fee wise) to any other client and send them on a happy hunting trip. |
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