7 Things to Know about Refinancing

By
Real Estate Agent with Carolina One Real Estate

With mortgage rates at record lows, many people are looking to refinance. Here are 7 things you need to know in today's market.

  1. Percentage Point break - a good rule of thumb is that the rate needs to be a full percentage point less than your current rate.
  2. Half rejected - with so many people looking to refinance and the tight credit market, do not expect to be automatically approved even if you do have a lot of equity in your home.
  3. FICO scores - 720 used to be the Gold Standard, now they are looking for 740 and above to get the best rate. Lower FICO scores equal a higher interest rate.
  4. Equity & Documentation - equity is key and you must be able to document the equity and will also have to document your income and assets.
  5. Fee Paying Options - fees range widely depending on each lender and look out for lenders adding in buy down points to get you that super rate. If it takes more than two years to pay back the closing cost amount with the monthly savings, it may not be worth it.
  6. Shop around - things are changing daily so if one lenders says no there may be another that says yes.
  7. Be patient - with the wave of refinancing there is a back log of loans so it may take some time to get the loan approved and closed.

Here are two lender contacts that I recommend to my clients. Feel free to mention my name if you give them a call.

Joel Greer - Carolina One Mortgage 843-414-2489, joel.greer@gbmail.com

Ted Honney - First Federal 843-708-0250, thonney@firstfederal.com

Search Charleston, SC and Folly Beach, SC Real Estate at http://www.charlestonpierpartners.com or log on to get our FREE Relocation package or FREE foreclosures updates

Call Randall Sandin at 843-209-9667 for more info about the Charleston area

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Topic:
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refinancing

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Rainer
336,310
Chip Jefferson
Gibbs Realty and Auction Company - Columbia, SC

Refinancing is a great option right now but I do think rates will be driven even lower with the way the economy is.

Feb 03, 2009 09:47 PM #1
Rainmaker
83,622
Randall Sandin
Carolina One Real Estate - Charleston, SC
843-209-9667 - Search for Charleston SC Real Estate

thanks Laura - I think you are right and we will see more 4-5% options in the near future however I hope people do not get too greedy and miss out - used to be underthing under 6.5% was a great deal

Feb 03, 2009 09:54 PM #2
Rainmaker
1,065,099
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

Randall I would disagree on the percentage point break if the previous loan was done with no points or closing costs. If that is the case refinancing would make sense to get the lower rate with no out of pocket costs.

Feb 03, 2009 11:21 PM #3
Rainmaker
83,622
Randall Sandin
Carolina One Real Estate - Charleston, SC
843-209-9667 - Search for Charleston SC Real Estate

Bill - great point on the point break - I was working under the premises of normal closing costs. But with rolling the fees in, it can be a smart move to refinance when under a point. Thanks for bringing that up.

Feb 04, 2009 01:41 AM #4
Anonymous
carolina guy

great post

carolina forest

Feb 08, 2009 11:00 PM #5
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Rainmaker
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Randall Sandin

843-209-9667 - Search for Charleston SC Real Estate
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