For Current Rate Locks & Refinancing: There's No Rule of Thumb

Mortgage and Lending with NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 IL Lic 031.0006220/WI

For Current Rate Locks & Refinancing:

There's No Rule of Thumb


     I'm working with a young couple that is currently obtaining financing for a newly constructed home (started the process in February this year).  During the last week, we reached the important step in their financing where we wanted to "lock-in" their loan interest rate, as their home is now nearing completion.
     At the time their mortgage application was taken, I quoted what that day's going rate was for their financing.  Because the markets had been moving up and down somewhat erratically at that time, I'd advised we monitor the rates for a while and bide our time regarding a rate lock-in.  
     I felt the likelihood of catching a lower rate during a downturn in the market was good ... especially since we "had time" while their house was being built.  My clients agreed and we decided to remain patient.  
     That patience paid off, as I was able to lock-in my client's interest rate at 1/2% lower than the rate they had originally reported as a goal.  That 1/2% represents real savings for them and they're thrilled.
     Now my young couple can happily relate the benefits they'll receive from locking-in their mortgage rate.  They'll reap savings with each monthly payment.  Not bad!  And a good example of old "rules of thumb" no longer relating to today's real estate and mortgage financing.
     The old "rules of thumb" no longer exist for Refinancing either.  Low or dropping interest rates don't always ensure a Refinance is right for you.  No, in today's mortgage financing, finding motivation and benefit in Refinancing (or not) is to be found in a "recipe" of nuanced items.

     Years ago, the "rule of thumb" regarding Refinancing was simple.  It revolved solely around interest rates.  

     What was that old "rule of thumb"?  If a 1% (or more) drop in your interest rate would be realized, it was smart to Refinance. 
     Today?  You need to gather and analyze many more things prior to making a decision regarding Refinancing.  

     What are some of the things you should take into consideration?
  • What is your present interest rate?
  • How many years are left on your present mortgage?  
  • How long do you plan on staying in your present home?
  • What other debt(s) do you have?
  • What type of mortgage do you presently have?
  • What would be your "break even point" for a new Refinance?
  • What are you present Credit Scores?
  • More ...     

     Asking each of the questions above will contribute to the overall analysis. Asking each will help define a final answer or solution.  Each answer secured will help reveal a path of action. 

     But it's important to point out:  The answers are specific only to the individual asking them.  
     The answer to these questions are found within a hopeful client's overall financial scenario.  The answers are also dependent on the future plans they hold.  
     Because Truth is:  A "rule of thumb" for Refinancing and locking-in interest rates no longer exists.  
     Each homeowner must avoid making comparisons to anyone else.  Each homeowner must seek and find the answers ... solutions ... and subsequent course of action specific to them.
     What's the best way to accomplish this?  Talk with a Lender. In Chicagoland (Illinois and Wisconsin), that's me.  
     Together, we'll analyze your present financial scenario and all options available to you.  We'll discover if Refinancing is the best financial course of action for you at this time. Then, we'll initiate a plan of action to help and assist you in successfully completing your goals, no matter what they are.

     Consider that plan of action your personal "rule of thumb", tailor-made to fit you and only you ...
    Hoping to Buy or Refinance a home in Chicago or elsewhere in the Chicagoland area? Contact me! I'll put my 37 years of Mortgage experience and expertise hard to work on your behalf. 
     I can be easily found at:

Gene Mundt
Mortgage Originator - NMLS #216987 - IL Lic. #031.0006220 - WI Licensed
American Portfolio Mortgage Corp.
NMLS #175656
Direct: 815.524.2280
Cell/Text: 708.921.6331

eFax: 815.524.2281



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Gene Mundt

 Mortgage Originator  -  NMLS #216987    

                                 IL Lic. #031.0006220  -  WI License #216987                                                                                                    

NMLS #175656


Gene Mundt, Mortgage Originator,  40+ years of #mortgage experience, will offer you exemplary mortgage service and advice when seeking:  #Conventional, #FHA, #VA, #Jumbo, #USDA, and Portfolio Loans in #Chicago and the greater Chicagoland region, including:  The #Lincoln-Way Area, #Will County, (#New Lenox, #Frankfort, #Mokena, #Manhattan, #Joliet, #Shorewood, #Crest Hill, #Plainfield, #Bolingbrook, #Romeoville, #Naperville, #Wilmington, #Peotone, etc.), #DuPage County, the City of Chicago, #Cook County, and elsewhere within IL and Wisconsin. 


Your Referrals & Testimonials are Always Greatly Appreciated! 




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Dick Greenberg
New Paradigm Partners LLC - Fort Collins, CO
Northern Colorado Residential Real Estate

Hi Gene - That's very solid advice. We still hear about "rules of thumb", and discovered, as we're doing our own refi right now, that, as usual, it all depends. Help from a great mortgage lender like you makes everything a lot clearer.

Jun 20, 2016 05:32 AM #1
CA COASTAL ESTATES Lauren Selinsky Perez CRS
California Coastal Estates - Aliso Viejo, CA
"Your Real Estate Broker" #oclauren

Always to check rates and if it's lower, it is absolutely worth the wait. A good rep. is honest and if it takes an extra day or week. That makes a loyal and honest lender/broker.

Jun 20, 2016 06:07 AM #2
Belinda Spillman
Aspen Lane Real Estate Colorful Colorado - Aurora, CO
Colorado Living!

I bet they were thrilled when you shared the news with them.  That is a huge savings for them.

Jun 20, 2016 06:48 AM #3
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Gene the old rules of thumb are out the window in this business these days.  There is a lot to consider when it comes to locking rates or refinancing a property.

Jun 20, 2016 06:51 AM #4
Noah Seidenberg
Coldwell Banker - Evanston, IL
Chicagoland and Suburbs (800) 858-7917

Excellent information Gene. I am so glad we have you here to give your in site.

Jun 20, 2016 01:57 PM #5
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

Good morning Gene. I give my clients the option, I give them advice based on my experience, as they always ask. Great job with your clients.

Jun 20, 2016 06:42 PM #6
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Hi Gene.  You did a great service for your clients by waiting to lock in the rates.  And, thanks for the formation about the nuances of refinancing in today's market.

Jun 20, 2016 08:51 PM #7
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Good morning Gene - times have really changed and it takes more just a lower rate.  A good mortgage adviser like yourself is the best source to help in making the decision.

Jun 21, 2016 01:57 AM #8
Debb Janes EcoBroker and Bernie Stea JD
ViewHomes of Clark County - Nature As Neighbors - Camas, WA
REALTORS® in Clark County, WA

Isn't it wonderful when you can help people out? I love it when we are able to save people money and provide exemplary service. D

Jun 21, 2016 05:10 AM #9
Jason Sardi
Auto & Home & Life Insurance throughout North Carolina - Charlotte, NC
Your Agent for Life

You mean I can't take what I learned back in the day and apply it to mortgages now?  That is utterly shocking:)


If memory serves, even back then, the 1% rule also had the caveat of it depending upon the loan amount.  If the loan amount was only $50,000, let's say, dropping the rate 1% may not make sense when you consider the closing costs and all that.


Oh, and hi Gene!

Jun 22, 2016 02:54 AM #10
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Jul 07, 2016 11:48 AM #11
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Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi

708.921.6331 - 40+ yrs experience
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