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Mortgage Help - Outta the Blue!

Old 05-27-2010, 12:49 PM
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Default Mortgage Help - Outta the Blue!

Put this in the category of sometimes good things DO happen for no apparent reason.

Overnight Fedex arrives from <Bank Name Here>. My 1st thought is uh-oh, this is probably not good news; kinda like getting a dreaded letter from the IRS. Open it up, read through it, scratch my head a bit, read it again, slowly and closely. It's an offer to refinance our current mortgage from 5.88% to 4.63%. No closing costs, streamlined, call this number and it's done. Okay, what's the catch? Since when does your mortgage holder offer to lower your interest rate? Banks are in the business of making money, not losing it. I hadn't inquired about refinancing or anything of that nature.

Call the number, it's legit. Bank lady tells me that the offer goes out to less than 10% of their mortgage customers and the only reason we got it is because we're an excellent customer and have always made our mortgage payments on time. I'm still skeptical and ask her what's the catch? Apparently, there is none. We talked through the math at the current and new interest rates and the bottom line is, no matter what, it will save me a bunch of money.

Said "Sign me up!" This is my kind of stimulus package and I didn't have to default, walk away from my home, or beg for govt. dollars. Just did what I thought was the right thing to do -- paid all my bills on time, even when it was difficult. With the lower rate, I'll even be able to pay it off early!

I'm still finding it kind of hard to believe, but true story.
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Old 05-27-2010, 01:12 PM
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Did she have a Nigerian accent?
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Old 05-27-2010, 01:31 PM
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Be careful buddy. The only way to do no closing costs loans is to build all the costs into the rate. If it can be done at a low enough rate, than its worthwhile. Who is the company offering this to you? Your mortgage company??? Again, be careful.
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Old 05-27-2010, 01:34 PM
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I would guess the bank looked at your rate and thought he is good and might refi somewhere else. So instead of the losing the loan they offer a deal.
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Old 05-27-2010, 01:44 PM
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find out what your payoff is now, and find out what it is going to be after the refinance. You want to make sure they don't just roll them into the loan amount, and not inform you.
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Old 05-27-2010, 02:30 PM
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Thanks for the words of advice. Not my very first mortgage, so yes I was skeptical on all of it like you guys are. The bank is paying the closing costs 100%, amount being financed into new mortgage is exact payoff on my current mortgage. I saw the fair lending statement this morning. It's legit. Yes, it is my current mortgage company. I didn't want to spam their name here, but if anyone wants to know who it is, PM me and I'll tell you. They even offered a lower rate if I was willing to pay points on it, but I don't want to do that.

Silly TunaColada -- they only have Nigerian accents in email!!!! Hahhahaha!
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Old 05-27-2010, 02:36 PM
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The bank is being proactive, with your good credit standing and equity in your home you could easily refinance elsewhere. Usually banks aren't that smart.
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Old 05-27-2010, 03:01 PM
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Originally Posted by Dulcecita Lures View Post
Thanks for the words of advice. Not my very first mortgage, so yes I was skeptical on all of it like you guys are. The bank is paying the closing costs 100%, amount being financed into new mortgage is exact payoff on my current mortgage. I saw the fair lending statement this morning. It's legit. Yes, it is my current mortgage company. I didn't want to spam their name here, but if anyone wants to know who it is, PM me and I'll tell you. They even offered a lower rate if I was willing to pay points on it, but I don't want to do that.

Silly TunaColada -- they only have Nigerian accents in email!!!! Hahhahaha!
That's great they kept the amout the same... Did they also keep the length of the loan the same based on your current paid in full date?

The real key to mortgage costs is taking all the payments and adding them up to determine the true cost of your house.

If you pay $1000/month and after 360 months still have 100's of thousands to pay off because of refi's it isn't much of a deal.
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Old 05-27-2010, 03:30 PM
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Originally Posted by gort View Post
That's great they kept the amout the same... Did they also keep the length of the loan the same based on your current paid in full date?

The real key to mortgage costs is taking all the payments and adding them up to determine the true cost of your house.

If you pay $1000/month and after 360 months still have 100's of thousands to pay off because of refi's it isn't much of a deal.
The length is the only thing that's different. It was originally a 15, it's nearly at 10 now, but will go back to a 15. We did a calculation on the 124 payments left. With the new rate, I can save $60 a month and still have it paid off in 124 months. I wasn't keen on the longer period of time, but I can still save money and keep it on track for payoff as I originally planned. Plus, if I need a bit of flexibility one month here or there, I can make the lower payment. Win-win!
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Old 05-27-2010, 04:12 PM
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We have something similiar with the credit union. They don't send a letter but I can call and check the current rates and just tell em to do it. They will change the interest rate but they will do a one time charge of 1/2 point.
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Old 05-28-2010, 03:59 AM
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Wells Fargo has made me this offer twice in the last five years. Yes, it was unsolicited and yes, it was legit. New mortgage balance was the exact same as old mortgage balance. No " settlement " in the traditional sense. They sent me a document booklet where I signed specific pages and only needed to have 1 page notified, returned the entire booklet to them and that was it. Simple and easy.

Yes, the new loan(s) were for the standard 30 year term but I asked for the 1st refi to be reduced to 20yr and the 2nd refi to be for 15yr, no problem, done. I kept making the same monthly payment or more as the original loan and now am ahead of the game as far as loan pay-off date.

Worked out fine for me, twice.
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Old 05-28-2010, 04:03 AM
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Sorry, meant notorized, not notified. What an airhead!
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Old 05-28-2010, 05:48 AM
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WARNING WARNING WARNING

I got the same exact thing from them 2 years ago!!!! Right when rates were at a SUPER low... I took them up on the offer... and they dragged it out for months and months... then, at the very end, they told me that when they did the appraisal my house wasn't worth what they thought. I was stunned. I know exactly what the house is worth, the number I gave was 10% UNDER comparable value.

Anyway... after all is said and done, I fight them and get a copy of the appraisal. You HAVE to see the houses they used as comps. Homes in the flood zone that back up to a MAJOR highway... another house was on a slab, in a flood zone (any house worth having where I live has a basement). Anyway... needless to say, they dragged it on and on until the rates started to creep up. I was at 5.75 at the time on a 30 year.

Fast forward about a year later... I get a call from the Office of the Comptroller of the Currency about this VERY scam. They had MANY reports and were working on it. Obviously many people have pie-in-the-sky thoughts of what there house is/was worth, but my numbers were dead-on right. PLUS I live in a cookie-cutter area, so there were tons of homes like mine being sold for MORE than I listed.

Anyway... the silver lining? Wells Fargo was only going to give me 5.00% (nothing out of pocket, like you got)... I ended up getting 4.375% w/ very little out of pocket (no points).

I am VERY happy they screwed me, or I may not have taken the new deal when it came along.

BE VERY CAREFUL. You are dealing with a SUPER SLEAZY BANK.

PM me if you need more information.
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Old 05-28-2010, 05:53 AM
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I should add, the 4.375 was NOT with Wells-Fargo... I closed every Wells Fargo account I had, as well as any card serviced by them after the scammed me. I should also add, that when I did the refi with the new company values had fallen another 20%, my home appraised AT THAT TIME for 15% MORE thant he number I GAVE Wells Fargo when they tried their scam.

Naturally, the new company did a real appraisal and used comparable homes in my area...

I am VERY serious... be VERY careful. 4.63% is a great rate... but I wouldn't trust those scumbags for a second.

Do you pay extra money toward your mortgage, on time?
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Old 05-28-2010, 06:29 AM
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My bank did this many years ago.

Offered me 5% when I was @ 6 5/8ths. Zero closing costs.

The caveat was going back to a 15 year when I had about 10 left.

By doing this, they woud actually make more money in the long run, If I let it run the term.

I asked about early payoff penalties and there were none. Next I asked how much extra I would need to pay per month to pay the loan off in the exact time I currently had remaining. They gave me the figure, the #'s worked for me so I took the deal.

Been paying the extra for about 6 years now and have about 4 left. It's gotten to the point where I'm losing or have lost any benefit to this and am looking at re-allocating my extra payment elsewhere.
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Old 05-28-2010, 02:01 PM
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these banks are trying to make you a customer for life
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Old 05-28-2010, 02:46 PM
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OldPete, all I can say is it worked for me, twice. No scamming attempted and the entire transaction, both times, took less than a month. Yes, on the second refi the apprasial came back lower than I thought it should be but was still way more than the loan balance, I was about at a 50% loan / value ratio.
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Old 05-28-2010, 08:54 PM
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Our mortgage is with Citi and we literally just got a UPS overnight letter last week with the same type of info. They have the correct mortgage amount, and are offering a lower rate with 3 different terms. We haven't had time to follow up on it, but we will. I was a skeptical as you all.
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Old 05-29-2010, 05:55 AM
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Like my father told me many times if it seems to good to be true it probably is
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Old 05-29-2010, 08:48 AM
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I've noticed that when the rates are spiking down, this is when you start to get these notices... from the sound of it, lots of folks here have had luck with it. I can tell you that Wells Fargo, for sure, played games to "keep you" and then, once the rates were less favorable, would give your the news.

I can also tell you that, in my case, when they were offering 5.0 I could have gotten 4.65, is it worth a couple grand to save the difference? Depends on your circumstances.

I've never had a bank actually try to "help" me in a way that was better than I could help myself.

That's just my experience...
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