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Lets just say your "friend" is not doing you any extreme best-buddy favors.
For that loan amount, I'd charge about $7000 in fees as well. Here
would be the breakdown:
Approx. $1200 - title fees
Approx. $650 - lenders fee - covers underwriting, flood cert, etc.
Approx $300 - appraisal fee
Approx $750 - pack - gets paid to the broker before commissions on every
loan
Approx $2000 - loan origination fee
Approx $2000 - broker fee
You have to remember, even though he is your friend, it is still a business
and there are costs to doing business. His broker may require him to charge
a minimum based on loan amount, etc. I just refied my parents and still
charged them $2850 on a $110k loan/ Nobody - including you - works for
free.
Bottom line is you are going to save about $275k by refinancing over the
life of the loan for a cost of just shy of $10k. If your friend met you on
the street and said give me $10k, and I'll give you $275k in return -
would you do it? You probably would.
"AJ M." <jerseycat10@nospam.yahoo.com> wrote in message
news:vK6dnStjr8I-HVnfRVn-gQ@comcast.com...
> Hello everyone. I'm interested in refinancing my home. I've a 30 year
> fixed-rate mortgage at 6.00%. My PITI payment is $1717.00. The initial
> loan value was $191,700. After 1.5 years, I owe ~ $188,000. I'm
> interested in refinancing down to 20 years, for the sole reason of
> chopping
> the 8.5 years of my mortgage. I lender friend of mine says that I can get
> a
> 20 year note at 5.125 from him. He says his company can only do that by
> charging me 1.5 points. All in all, he gives me a high estimate of 7000
> in
> closing costs, which would be rolled into my new note. So my new note
> would
> be for 195,000, at 5.125%, for 20 years. My principal and interest alone
> would go from 1150 a month to 1300 a month, however, I'd drop PMI by
> reapprasing, so my monthly payment would only grow by ~ $50.
>
> Does this all sounds reasonable to everyone? The only thing that sticks
> out
> to me is the $7000 closing costs. It seems high, even including the 1.5
> points.
>
> Thanks.
>
>
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Re: Refinancing Question
