FB: Liberty League

[JQV]

jose...fyi fed dropped overnight lending rate 50 basis points yesterday people hammered the long bond which together will drive mortgage rates down allowing people to refinance and lock in at much lower rates reducing their payments thus delinquencies/foreclosures etc...

I read a story about this in another paper this morning.  Mr. and Mrs. Jose are about 6 months in on the 30-year fixed mortgage on their first house.  If we think about refinancing for this lower interest rate (which we don't need but every little bit helps...right?) will we get ourselves into an ARM?

[Senor RedTackle]

jose...fyi fed dropped overnight lending rate 50 basis points yesterday people hammered the long bond which together will drive mortgage rates down allowing people to refinance and lock in at much lower rates reducing their payments thus delinquencies/foreclosures etc...

I read a story about this in another paper this morning.  Mr. and Mrs. Jose are about 6 months in on the 30-year fixed mortgage on their first house.  If we think about refinancing for this lower interest rate (which we don't need but every little bit helps...right?) will we get ourselves into an ARM?

Not for nothing but it would be a mistake for you to refinance until at least 18 months. You'd be way out of pocket for closing closts....regardless of the tax deduction, it would still not be worth the small savings in interest until you sat on the loan for a bit. Plus, you are using this interest to your advantage right now in taxes. RT says sit tight unless you have some stupid loan, like in the 9% or above range

[PBR...]

jose...fyi fed dropped overnight lending rate 50 basis points yesterday people hammered the long bond which together will drive mortgage rates down allowing people to refinance and lock in at much lower rates reducing their payments thus delinquencies/foreclosures etc...

I read a story about this in another paper this morning.  Mr. and Mrs. Jose are about 6 months in on the 30-year fixed mortgage on their first house.  If we think about refinancing for this lower interest rate (which we don't need but every little bit helps...right?) will we get ourselves into an ARM?

jose it cant hurt to ask the lender to waive the costs...pbr's bank has done this many a time for him...especially if you know the loan officer give him/her a call and ask them to waive the fee's....they very well may do it. if they wont waive the fees like RT said unless you have some high int. rate sit tight and ride it out if you do get a arm be careful and know your terms..i.e. is the rate locked and how long? any prepayment penalties or refi penalties if rates continue to drop and you want to lock in a fixed rate in the future etc....

[JQV]

I do know the Loan Officer, which is how we qualified for the 30-year fixed in the first place.  The rate is good and we can afford the payments so I may give them a call but will probably sit tight.  If and when I do call the loan officer, I will let her know that I have been counselled by LLPP Financial Advisors, Inc.

[Pat Coleman]

Q: We got our most recent mortgage four years ago and got a fairly good rate (under 6). We got plenty of solicitations for refinancing but never bit and we're pretty happy with it.

[Senor RedTackle]

Q: We got our most recent mortgage four years ago and got a fairly good rate (under 6). We got plenty of solicitations for refinancing but never bit and we're pretty happy with it.

any points for a sub-6 rate? RT has sniffed around for those but didn't like the points..or after reading the fine print on some of these "discount" rates, RT didn't like the terms either. RT is content with his 6.5%, 30 year fixed he got from Countrywide in Dec '05. (Did a bunch of shopping around and used a mortgage broker as well)

[Pat Coleman]

Q: We got our most recent mortgage four years ago and got a fairly good rate (under 6). We got plenty of solicitations for refinancing but never bit and we're pretty happy with it.

any points for a sub-6 rate? RT has sniffed around for those but didn't like the points..or after reading the fine print on some of these "discount" rates, RT didn't like the terms either. RT is content with his 6.5%, 30 year fixed he got from Countrywide in Dec '05. (Did a bunch of shopping around and used a mortgage broker as well)

No points!

We did really well on our townhouse (1999-2003) and that sale parlayed into a nice down payment.

[Frank Rossi]

jose...fyi fed dropped overnight lending rate 50 basis points yesterday people hammered the long bond which together will drive mortgage rates down allowing people to refinance and lock in at much lower rates reducing their payments thus delinquencies/foreclosures etc...

I read a story about this in another paper this morning.  Mr. and Mrs. Jose are about 6 months in on the 30-year fixed mortgage on their first house.  If we think about refinancing for this lower interest rate (which we don't need but every little bit helps...right?) will we get ourselves into an ARM?

The rate drop will not force rates on mortgages down instantaneously.  Most mortgage rates are geared to the 10-Year Note rate, which had been pricing in a lowering of rates by the Fed over the last couple months.  In fact, mortgage rates, when they post the weekly average, may go up this week, as the 10-Year Note has stagnated this week.

That being said, you should wait on the refinancing, as this is not the Fed's final move.  A half-point move is usually an indicator that there may be several quarter-point moves on the horizon.  My guess is that the Fed will make such a quarter-point move in six weeks, meaning the 10-Year Note will begin to reflect a lower yield over the next month.  We may see two or three more drops before the new year.

Should you refinance now?  No.  Even if the lender waived costs (unlikely right now for all costs to get waived), the benefit is minimal.  There is greater benefit down the road.  And don't take an ARM.  That's how the problems with the credit crunch began in the first place.  If somehow the economy turns around next year, the Fed may turns the rates back higher (or if inflation were to dominate the marketplace).  That means you'd be screwed in the longrun.  Right now, keep your current mortgage and begin watching the Fed's moves and the 10-Year Note yield (Yahoo Finance symbol ^TNX).

[Frank Rossi]

Q: We got our most recent mortgage four years ago and got a fairly good rate (under 6). We got plenty of solicitations for refinancing but never bit and we're pretty happy with it.

any points for a sub-6 rate? RT has sniffed around for those but didn't like the points..or after reading the fine print on some of these "discount" rates, RT didn't like the terms either. RT is content with his 6.5%, 30 year fixed he got from Countrywide in Dec '05. (Did a bunch of shopping around and used a mortgage broker as well)

That's about as good as you'll get for a while, even with the rate drop.  Don't have buyer's remorse on it; you did well.

['gro]

This Week in LLPP:

Shoes (no, actual shoes)
Mortgages
Fantasy Football (of course)
LL's out of conference record
The Role of Tazers in Open Debates
Cat Turds
Baseball (sox/yanks)
Live-in Girlfriends

I love this place.

[Frank Rossi]

This Week in LLPP:

Shoes (no, actual shoes)
Mortgages
Fantasy Football (of course)
LL's out of conference record
The Role of Tazers in Open Debates
Cat Turds
Baseball (sox/yanks)
Live-in Girlfriends

I love this place.

Seriously.  The E8ers are too serious for my blood.  It's all Ithaca/SJF and the food in the area...Even when we're in Shooz Week, we all seem to find random cheerleader pictures to post to keep things real.  This is why...

LLPP Rulez and E8PP sucks PP.

[Senor RedTackle]

This Week in LLPP:

Live-in Girlfriends

Anyone notice how RT has flown below the radar on this topic??

[Stlarry]

Speaking of cheerleaders, isn't it time we met this year's USC Song Girls?
http://www.usc.edu/student-affairs/IMREC/spirit/song/thesquad/thesquad.html

[Senor RedTackle]

Speaking of cheerleaders, isn't it time we met this year's USC Song Girls?
http://www.usc.edu/student-affairs/IMREC/spirit/song/thesquad/thesquad.html

RT is way ahead of you...he's already done his homework on the USC song girls..

http://www.withleather.com/post.phtml?pk=2628

and what "songs" do they sing, anyway?

[Jonny Utah]

This Week in LLPP:

Shoes (no, actual shoes)
Mortgages
Fantasy Football (of course)
LL's out of conference record
The Role of Tazers in Open Debates
Cat Turds
Baseball (sox/yanks)
Live-in Girlfriends

I love this place.

Seriously.  The E8ers are too serious for my blood.  It's all Ithaca/SJF and the food in the area...Even when we're in Shooz Week, we all seem to find random cheerleader pictures to post to keep things real.  This is why...

LLPP Rulez and E8PP sucks PP.

Although LLPP is fantastic for your health, you can't fault E8PP for talking about d3 college football and college food in Ithaca.