This topic contains 4 replies, has 1 voice, and was last updated by Anonymous 8 years, 6 months ago.
- May 5, 2011 at 11:29 am #204308
The storm is coming, as predicted there will be many companies going under this year due to non compliance issues and bad advice given to consumers.
On the 6th of December this year the Office of Fair Trading have put a marker against their credit licence that they are due to remove it to close the business down.
Please read the link here…
For any consumers currently with First Step Finance seek alternative advice before it could be too late.
- May 19, 2011 at 6:21 pm #430565
From Money Magazine.
Only re-fi if you can get 1.93% lower interest rate.
And only if you do NOT make your loan a longer term than it already is.
That will just make you poorer in the long run.
Only refi if you know you will be in the home for more than 5 to 7 years.
The closing costs will be added to the loan – nothing in this world is free.
Be careful with them jacking up that interest rate at the last miniute.
They will get you all hiped up, and then give you the higher rate – keep an eye on them.
A company can not force you to use their insurance company.
Demand that the insurance not be added to escrow.
Their company could double next year – and you might be forced into carrying their insurer for the life of the loan – it could be a trick.
Careful with Chase – watch their every move.
These closing costs – have me a bit scared – again – nothing in this world is free.
They will get the closing costs from you somehow.
Google : average closing costs calculator
- May 19, 2011 at 6:28 pm #430566
Sounds like one hand doesn’t know what the other hand is doing. Contact them and tell them you pay your taxes and insurance separately.
2% is good rate for saving money. But how long have you been paying on your mortgage? If this starts you back at 30 years and you won’t get out of debt until you’re 85, not a good deal. Unless you can accelerate your mortgage, so you will be out of debt by time you retire, or you have a long-term plan and are knowledgeable in using your equity in your home wisely.
So, this is why you get a good faith estimate. Question this to your satisfaction.
- May 19, 2011 at 6:39 pm #430567
Well first it depends on what type of insurance they added. Some banks are now requiring mortgage insurance (in case you can not pay the mortgage), so that may be the cost.
Or.. they may routinely add in the cost of an insurance policy to the closing costs since you must provide them with new proof of insurance. Then, when you do, they take it out.
OR… they may wish to create an impound account for you and pay the insurance from that.
Bottom line.. you need to ask exactly the same question(s) to Chase….
BUT.. for your information… Currently I am being offered a 30 year fixed rate of 4.37 and change as I make inquiries about refinancing.. you said that your offer is 2% less then what you are paying now, but that does not give the proposed rate. If the offered rate is not close to this number (in the last week of September) then you may want to shop around some more anyway.
- May 19, 2011 at 6:51 pm #430568
When you ask your lender about this you will find the amount is not a fee, but an estimate for the annual cost of your hazard or home owner’s insurance. Even though they already have information about your policy in file, they are making this offer to hundreds if not thousands of their customers and the number for the estimate was generated by a formula, not by looking up your actual premium. They are required to include and estimate of the cost whether you pay it with the loan or separately because either way you are paying for it. The “new and improved” 2010 Good Faith Estimate has succeeded in confusing borrowers more, not less. Thank your Congressman next time you see him.
You appear to be getting a competitive rate. Lenders do the “no closing cost” loan by adding 3/8% to 1/2% to the rate that includes closing costs. There is nothing crooked or deceptive about it and it actually makes sense for many people to do it this way, especially if they are not sure if they will remain in the home or the loan long enough to recoup standard closing costs. The only possible downside is that you might save more in the long run by paying the fees and taking the lower rate if you should remain in the loan for the remainder of the contract.
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